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Adani Stock Selloff saga continues, as $117 Billion Wiped Out!

The stock rout roiling Adani’s indebted conglomerate entered a third week, with the billionaire and his family prepaying $1.11 billion worth of borrowings backed by shares in a bid to restore investor confidence.

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Bloomberg chart on Adani stock fluctuation 

The meltdown since US short-seller Hindenburg Research made fraud allegations against the ports-to-power group in a Jan. 24 report has wiped out $117 billion, or almost half of the market value of its companies. Adani has repeatedly denied the claims.

  • Six of the group’s 10 stocks ended lower in Mumbai on Monday, with Adani Transmission Ltd. and Adani Total Gas Ltd. leading the losses.

Worries about the conglomerate’s access to funding rose further after Bloomberg reported Saturday that Adani Enterprises Ltd., its flagship firm, has shelved a bond sale just days after it abandoned a record stock offering.

S&P Global Ratings also has cut its outlook on a port operator and an electricity distributor in the group, just as some of the companies are due to release quarterly earnings this week, giving investors a chance to scrutinize the conglomerate’s financial health.

The founders’ early payment of borrowings will help release 11.77 million shares in Adani Transmission Ltd. and as many as 168.27 million shares of Adani Ports & Special Economic Zone Ltd., the group said in a statement Monday.

Adani Ports’ stock erased intraday declines to finish 9.3% higher, its biggest gain since April 2021. The flagship ended 0.9% lower and is now down 54% since the rout began.

The tumult has disrupted parliament and India’s main opposition party is ramping up pressure on Prime Minister Narendra Modi over his silence on the issue. It staged some protests on Monday to highlight the risk to small investors.

Hindenburg Research accused the group of “brazen” market manipulation and accounting fraud, claiming that a web of Adani-family-controlled offshore shell entities in tax havens were used to facilitate corruption, money laundering and taxpayer theft.