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Thursday March 28, 2024

Adani shares dive again as Indian opposition stages demos

Group owned by tycoon Gautam Adani has lost around $120bn in value since claims were levelled by short-seller US investment group Hindenburg Research on January 24

By AFP
February 06, 2023
Indian tycoon Gautam Adanis personal fortune has dived by more than $40 billion.— AFP/file
Indian tycoon Gautam Adani's personal fortune has dived by more than $40 billion.— AFP/file

MUMBAI: Investors dumped more Adani stock on Monday as India's opposition staged protests calling for a full enquiry into allegations of major accounting fraud at the country's biggest conglomerate.

The group owned by tycoon Gautam Adani has lost around $120 billion in value since the claims were levelled by short-seller US investment group Hindenburg Research on January 24.

Trading in Adani Total Gas, in which French oil giant TotalEnergies owns a 37.4% stake, and in Adani Power was again suspended after the stocks fell 5%.

Shares in flagship Adani Enterprises, which before the rout gained more than 1,000% in five years, were down 2.0%, having been off almost 10% in volatile early trade.

The slide has raised concerns about the group's ability to raise fresh financing — it cancelled a share sale last week and reportedly also a bond issue — to pay down its debts.

India´s Congress party activists take part in a nationwide protest outside the Life Insurance Corporation (LIC) office in Prayagraj on February 6, 2023. — AFP
India´s Congress party activists take part in a nationwide protest outside the Life Insurance Corporation (LIC) office in Prayagraj on February 6, 2023. — AFP 

The main opposition Congress party, which has called for a "serious investigation" by the central bank and regulator, on Monday staged protests including in New Delhi and Mumbai.

The party says that Gautam Adani's close ties with Prime Minister Narendra Modi, who is also from Gujarat state, has won contracts unfairly and avoided proper oversight.

Commerce Minister Piyush Goyal said on Saturday that Indian regulators "are very competent and our financial markets are amongst the most respected and well regulated markets in the world."

Finance Minister Nirmala Sitharaman on Sunday said that Adani had also won business in Indian states not run by Modi´s governing Bharatiya Janata Party (BJP).

"Any project under Prime Minister Modi goes through the open tender process (of) global tendering," Sitharaman told broadcaster Times Now.

The company has rejected the claims made by Hindenburg and last week Adani, 60, insisted that the "fundamentals of our company are very strong, our balance sheet is healthy and assets robust".

His personal wealth has more than halved, seeing him fall from number three in the Forbes real-time rich list to 22nd as of Monday with a fortune of $58.5 billion, down from $127.0 billion.

India´s securities regulator SEBI said Saturday that it was "committed to market integrity" and without naming Adani said it always properly examines all "specific entity related matters".