Gautam Adani's Companies Suffer Bloodbath Friday As Market Seems To Sideline Rebuttal

Shares of Adani Group companies crashed at the open on Friday, amid the ‘exchange of statements’ between the conglomerate and New York-based short seller Hindenburg Research.

The Rebuttal: Adani Group offered a “point-by-point” rebuttal to Hindenburg’s claims in a document published Thursday evening.

The conglomerate run by India and Asia’s richest and world’s fourth richest person Gautam Adani said eight out of its nine publicly-listed companies are audited by “big 6” accounting firms like Deloitte and Ernst & Young.

Adani Group further said six of these companies are subject to “specific sector regulatory review for revenue, costs and capex.” It also challenged the assertion that the group engages in overleverage that puts creditors at grave risk. It said about 100 odd companies it runs — which accounts for almost all of its earnings before interest, taxes, depreciation and amortization and amortization (EBITDA) — are rated.

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The group further said that the overall promoter leverage accounts for below 4% of promoter holding.

The Legal Fight: Adani Group said it was exploring legal options in both India and the United States against the Nathan Anderson-founded short seller on Thursday after earlier saying it was “shocked” by the report, dubbing it “malicious” and riddled with “misinformation.”

Hindenburg hit back at Adani Group following the legal threat, saying the latter had resorted to “bluster and threats.”

The research firm said it would “welcome” any legal action from Adani as any such case “would be meritless.” It further challenged Adani Group to file the case in the U.S., where it operates, and said such a move would, in fact, allow it to demand more internal documents from the conglomerate.

Price Action: This is how prominent Adani Group shares traded at the open on Friday on the BSE after a day’s break in observance of the Republic Day:

Adani Enterprises shares traded 5.9% lower at ₹3,222.00.

Adani Green Energy shares traded 13.16% lower at ₹1,622.00.

Adani Ports & Sez saw shares crash 6.30% to ₹712.90.

Adani Power shares slumped 4.5% to ₹681.35.

Adani Total Gas shares were down 17.6% to ₹3005.15.

Adani Wilmar shares were down 5% at ₹517.30.

Adani Transmission shares were down 16.12% at ₹2,115.25.

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