Why Adani Group Is Firefighting A Report That Hasn't Been Published Yet

The Adani Group has strongly rebutted an upcoming article by the Financial Times, saying it was an attempt to rake up “old and baseless allegations to tarnish the name and standing” of the firm. The company has accuses the report of being part of a broader campaign aimed at advancing vested interests under the guise of public interest.

What Happened: The Adani Group’s said the business publication, in collaboration with the George Soros-funded Organized Crime and Corruption Reporting Project (OCCRP), had previously released a “false narrative” against the group on August 31, and is now making another attempt to destabilise the company financially by bringing up an old claim of over-invoicing of coal imports.

The company said FT’s upcoming story references a circular from the Directorate of Revenue Intelligence (DRI) dated March 30, 2016.

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Adani’s Argument: The Adani Group argues that the FT’s agenda is evident because the circular mentions 40 importers, including Adani Group companies, rather than singling out the Adani Group. The list includes several major private power generators in India, such as Reliance Infra, JSW Steels and Essar, as well as state power generating companies and the NTPC and MSTC.

The Adani Group drew attention to Knowledge Infrastructure, one of the 40 importers mentioned in the circular, whose show-cause notice alleging over-valuation in the import of coal from the DRI was quashed by the appellate tribunal (CESTAT). The DRI’s appeal was dismissed by the Supreme Court on January 24, 2023. This, according to the Adani Group, conclusively settles the issue of overvaluation in coal imports.

The Adani Group characterizes the FT’s proposed story as a recycling and selective misrepresentation of publicly available facts with a deliberate suppression of judicial decisions. It asserts that the story demonstrates a lack of respect for India’s regulatory and judicial processes and authorities.

The Adani Group condemned the allegations and accused foreign entities, short-sellers, domestic collaborators and certain sections of the foreign media of launching coordinated attacks to damage the group’s market value. The statement also hinted at that these allegations often coinciding with important court hearings in India.

Why It Matters: The Adani statement made direct reference to journalist Dan McCrum, who was responsible for uncovering financial fraud at payments firm Wirecard, which turned out to be the biggest scam in German history.

Commentators on X have suggested that Adani may face similar scrutiny once the article is published, which would add further pressure to the group’s stocks, which had been battered by the allegations first levelled by short-seller Hindenburg Research.

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Posted In: Emerging MarketsMarketsMediaAdani GroupDan McCrumFinancial TimesHindenburg ResearchOCCRP