Adani Group Stock Prices Experience Decline, Resulting in a Market Capitalization Erosion of INR 35,600 Cr
In the recent trading session, various stocks under the Adani Group, including Adani Enterprises Ltd, Adani Green Energy Ltd, Adani Ports and Special Economic Zone Ltd, and Adani Power Ltd, experienced a significant downward trajectory. This downturn has led to a noteworthy depreciation in the conglomerate’s market capitalization, with the erosion amounting to more than INR 35,600 Crore. The catalyst behind this decline can be attributed to a report by the Organized Crime and Corruption Reporting Project (OCCRP), which made allegations regarding the trading of substantial sums of money in select Adani stocks through opaque Mauritius-based funds. These transactions were purported to conceal the involvement of business partners affiliated with the Adani family.
Adani Group Strongly Dismisses Allegations as Recycled and Baseless, Highlighting Orchestrated Campaign
The Adani Group has unequivocally refuted the allegations put forth by the non-profit media organization, terming them as “recycled allegations.” The conglomerate has underscored that the news reports appear to be part of a coordinated endeavor backed by interests funded by George Soros and bolstered by a segment of the foreign media. This effort is perceived as an attempt to resurrect the discredited Hindenburg report.
Persistent Pressure on Adani Group Stocks Leads to Market Capitalization Contraction
Despite the prevailing challenges, the Adani Group’s stocks remained ensnared in a protracted period of pressure. This sustained downward trend in stock performance is exemplified by a collective reduction in the market capitalization (m-cap) of its ten listed companies, reflecting a decrease of INR 35,624 crore. This decline resulted in the cumulative m-cap tallying at INR 10,49,044.72 crore, as opposed to the previous INR 10,84,668.73 crore recorded on the previous Wednesday.
Impact on Individual Entities within the Group:
Among the individual entities within the Adani Group, Adani Enterprises faced a noteworthy m-cap depreciation of INR 9,570.31 crore, underscoring the extent of the financial contraction experienced. Adani Green Energy, a prominent player in the renewable energy sector, experienced a m-cap decline of INR 6,200 crore. Both Adani Ports and Adani Power bore the impact of this sustained pressure, suffering an erosion of m-cap ranging between INR 5,000 crore and INR 5,300 crore. Adani Energy Solutions, on the other hand, sustained an approximate m-cap loss of nearly INR 3,000 crore. Simultaneously, the market valuation of Ambuja Cements witnessed a decline by INR 2,680 crore.
Adani Group Stocks Continue Downward Spiral with Substantial Declines in Various Entities
The downward trajectory of Adani Group stocks persisted, leading to significant declines in multiple entities within the conglomerate. The unfolding scenario witnessed:
- Adani Enterprises: The shares of Adani Enterprises encountered a decline of 5.11 percent, ultimately reaching a nadir of Rs 2385 on the Bombay Stock Exchange (BSE).
- Adani Ports: Adani Ports experienced a reduction of 2.92 percent, culminating in a share value of Rs 795.10.
- Adani Power: Adani Power sustained a notable downturn of 4.45 percent, resulting in a valuation of Rs 313.80 per share.
- Adani Energy Solutions (formerly Adani Transmission): The entity, now Adani Energy Solutions, observed a decline of 3.53 percent, leading to a share price of Rs 812.05.
- Adani Green Energy: The shares of Adani Green Energy underwent a significant tumble of 4.37 percent, reaching Rs 928.25 per share.
- Additional Entities: Other entities within the conglomerate, such as Adani Wilmar, Adani Total Gas, ACC, and NDTV, also encountered declines ranging up to 3.2 percent.
These declining trends underscore the continued challenge and downward pressure experienced across multiple Adani Group entities in the ongoing market conditions.
Adani Group Clarifies OCCRP Allegations as Historical and Resolved Matters
The Adani Group has provided a comprehensive clarification in response to the allegations presented by the OCCRP. The group has emphasized that these allegations stem from cases that were concluded over a decade ago, specifically during a period when the Directorate of Revenue Intelligence (DRI) initiated investigations into a range of matters. These encompassed allegations surrounding over invoicing, offshore fund transfers, transactions involving related parties, and investments facilitated through Foreign Portfolio Investors (FPIs).
Incorporating the findings from these historical investigations, the Adani Group has highlighted that both an independent adjudicating authority and an appellate tribunal subsequently confirmed the legality and compliance of the transactions in question. The group underscores that the outcomes of these reviews were conclusive in determining that there was no instance of over-valuation and that all transactions were executed in alignment with the prevailing legal frameworks.
Adani Group Asserts Resolution and Supreme Court Validation of Matter
In response to the OCCRP allegations, the Adani Group has underscored the conclusive resolution of the matter. The conglomerate has emphasized that the case achieved finality in March, marked by a favorable ruling from the Supreme Court of India. This judicial validation underscores the legitimacy of the group’s actions and dealings under scrutiny.
The Adani Group has drawn attention to the pivotal fact that the Supreme Court’s ruling substantiates the absence of over-valuation, thereby nullifying any basis for the allegations concerning fund transfers. Furthermore, the group highlights that the entities under investigation, namely the Foreign Portfolio Investors (FPIs), are already subjects of examination by the Securities and Exchange Board of India (SEBI). This aspect signifies that relevant regulatory bodies are actively involved in assessing the situation.
Adani Group Expresses Disappointment Over Selective Reporting
The Adani Group has expressed its disappointment over the manner in which certain publications chose to present the allegations, underscoring that despite having provided a comprehensive response to their queries, these publications opted not to publish the response in its entirety.
The group highlights that this selective reporting approach raises concerns regarding the intent behind these allegations. The Adani Group asserts that such actions appear to be driven by motives beyond objective reporting and potentially aim to achieve various objectives, including financial gains through the manipulation of stock prices.
Addressing Short Sellers and Regulatory Scrutiny:
The conglomerate further elucidates that these orchestrated attempts seem to be orchestrated to benefit short sellers – individuals or entities that seek to profit from declining stock prices. The Adani Group points out that such actions are not only aimed at driving down stock prices but also potentially disrupting the integrity of the market.
In light of these concerns, the Adani Group asserts that these short sellers are currently under investigation by various regulatory authorities. This assertion highlights that the actions undertaken by these market participants are being closely scrutinized by relevant entities to ensure that market fairness and integrity are upheld.
