Mumbai: Adani Enterprises Ltd., the flagship firm of billionaire Gautam Adani, has successfully overcome the losses it had suffered due to critical reports carried in a US-based short-seller Hindenburg Research in early 2023, after the company managed to slim its debt and landed major projects.
The reports published in the US-based Hindenburg Research, alleging wide-ranging corporate malfeasance and stock manipulation in January 2023 had inflicted a staggering loss of over $30 billion. The group however, repeatedly denied those allegations. The flagship company made impressive recovery at the stock market on Friday, when its share rose 1.7% to 3,445.05, which is almost three times of its value in February 2023.
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The latest jump in stock value, some market analysts believe, was attributed to the Adani Group’s bid to include Adani Enterprises‘ stock in the benchmark S&P BSE Sensex Index in June. The group also roped in other companies to engage with global investors to raise fresh debt, which needed for the company’s plans to expand its cement and copper businesses. “Apart from Adani Enterprises, stocks of at least five of 10 listed Adani group of companies are trading above the levels seen before the Hindenburg report,” said a market analyst.
A fund manager based in Mumbai said that Adani Group is among the very few companies in the country that can handle big projects. “Thanks to its good connect and positive image in the corridors of power, investors from across the globe are looking at Adani group. Shares of Adani Ports and Special Economic Zone Ltd. and Adani Power Ltd. have been among the best performers this year among the group companies,” he said, adding more than 35% each while television broadcaster New Delhi Television Ltd. has been the biggest laggard, giving away 5.5%.
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Notwithstanding the mud-slinging on the Adani Group during the ongoing the Lok Sabha elections, the conglomerate’s shares have rallied this month. The Adani group came up for criticism from an unexpected quarter, when Prime Minister Narendra Modi made unsubstantiated allegations that main opposition party received black money billionaires Mukesh Ambani and Gautam Adani. Back in January 2023, the short seller Hindenburg’s bombshell report saw Adani Enterprises scrap a $2.4 billion equity offering, which was then poised to be India’s largest follow-on share sale amid a stock meltdown that at one point eroded more than $150 billion from the group’s market value. The report had also impacted personal wealth of Adani and the short-seller’s claims saw regulatory inquiry in India.
Stock market analysts said that the group is now less than $30 billion far from regaining the market worth that it commanded before the scathing report came up in public domain. The first leg of the recovery in Adani stocks came in March last year after star emerging-market investor Rajiv Jain’s GQG Partners bought shares worth almost $2 billion in four of the group firms, including the flagship, from an Adani family trust. Jain added to his positions through 2023. The group also drew investments from Qatar Investment Authority and UAE-based International Holding Co.
