News Desk
ISLAMABAD/NEW DELHI: India’s Adani Group’s shares plummeted to a record low and the largest conglomerate witnessed losses of $66 billion to its shares in the last three days.
The Adani Enterprises (ADEL.NS), which was facing a crucial test this week with a follow-on share offering, rose 4 per cent but it shed initial gains to at least 10 per cent , which was significantly below the offer price.
Earlier, Adani Group issued a detailed response to a report by US investment firm Hindenburg Research that sparked a $48 billion rout in its stocks, and said it complies with all local laws and had made all the required regulatory disclosures.
The group of companies led by Asia’s richest man, the Indian billionaire Gautam Adani, said last week’s report was intended to enable the US-based short seller to book growth, without citing evidence. The response by Adani comes as its flagship company, Adani Enterprises (ADEL.NS) is attempting to sale shares worth $2.5 billion. This has been overshadowed by the report by Hindenburg, which raised concerns about high debt levels and the use of offshore tax havens.
“All transactions entered into by us with oprganizations who qualify as ‘related parties’ under the laws of India and accounting standards have been duly disclosed by us,” Adani group said in the 413-page response issued late on Sunday.
“This is in fact a rife with conflict of interest and intended just to create a false market in securities to enable Hindenburg, an admitted short seller, to book massive financial gain through wrongful means at the cost of countless investors,” it read.
Adani said Hindenburg’s report made “misleading claims around offshore entities” without any evidence whatsoever.
Adani’s lack of direct, transparent answers is telling: Hindenburg
Hindenburg Research said it “found Adani’s lack of direct and transparent answers” on the allegations of offshore tax heavens “telling”.
The report issued Wednesday questioned the conglomerate’s ownership of companies in offshore tax havens such as Mauritius and the Caribbean. It also claimed that Adani companies were under substantial debt”, and consequently on a “precarious financial footing”.
Adani Group is among India’s biggest businesses and operates in several industries, including commodities trading, airports, utilities and the renewable energy sector.
The conglomerate’s 60-year-old head last week slipped to the seventh rank on Forbes rich list following the allegations by Hindenburg.
