India’s Adani Group claims that ‘misleading’ reports have not affected its financial position

In its latest reply to a Hindenburg Research study in January 2023, India’s Adani Group argues its financial situation remains unaltered despite “misleading” reports. According to the statement, the Ahmedabad-based company has “rebounded strongly since the release of a short-selling report in January 2023,” which did not include New York-based Hindenburg. The Hindenburg report accused the Adani Group of stock manipulation and inappropriate use of offshore tax havens and expressed worries about the company’s high debt level.

Adani Group has categorically refuted all charges mentioned about the Adani scam. According to the company, Adani Group’s four major firms – Adani Enterprises, Adani Ports, Adani Green, and Adani Power – have all risen more than 100% from their low points in 2023.

Adani Group’s response to the allegations about the Adani scam issue

Adani Group’s chief financial officer, Jugeshinder Singh, issued a formal statement in which he described the Adani scam as a “malicious combination of selective misinformation and stale, baseless, and discredited allegations.” In its formal response, Adani Group did not address specific claims but stated that it has always complied with the law. The conglomerate further alleged that the timing of the study suggested a purposeful attempt to harm the Adani Group’s reputation.

The primary goal of harming the upcoming follow-on Public Offering from Adani Enterprises refers to the Group’s plans to increase the number of freely traded shares. Adani Group said in a fresh statement on January 26, 2023, that it is exploring legal action against Hindenburg. Jatin Jalundhwala, Adani Group Legal Head, stated they are assessing the appropriate remedies under US and Indian legislation for corrective and punitive action against Hindenburg Research.

He further stated that the story caused significant volatility in Indian stock markets, which has caused undue sorrow for Indian residents. Hindenburg has challenged Adani Group to suit, claiming that doing so will expose the corporation to more scrutiny. The study was released only days before bidding for a $2.5 billion stock sale for Adani’s secondary shares, which will include anchor investors such as the Abu Dhabi Investment Authority and Morgan Stanley.

According to one investor, they are “aware” of Hindenburg’s research and are “considering it.” This is a deliberate attack on India, the independence, integrity, and quality of Indian institutions, as well as the country’s growth narrative and aspiration, according to Adani’s reaction.

The misleading reports had no significant impact on the group’s business performance

Adani Ports, the group’s most widely held institutional stock, and Adani Power are trading higher than before the Hindenburg report was issued, “indicating a lack of trust in these misleading reports,” Said Adani Group. Their share prices closed higher at the close of trade in Mumbai on October 20, 2023, up 0.9% and 3.3%, respectively. Adani Green gained 2.1 percent, while Adani Enterprises gained 1.3 percent.

The misleading reports on Adani Group, India’s largest critical infrastructure developer, have had no significant impact on the group’s business performance or ability to create shareholder value.

Adani Group also emphasised worldwide organisations’ investments

Adani Group also highlighted worldwide investments, including $381 million from Abu Dhabi’s International Holding firm, the UAE’s most valued holding firm. Qatar Investment Authority and GQG Partners are two more big investors in 2023. Adani Group has stated that none of its long-term investors had left the company following the Adani scam controversy. These organizations have continued to support, with some increasing their engagement.

The Adani Group is still introducing investors to India’s infrastructure story

Even after the Adani scam controversy, the Group continuously works to improve India’s infrastructure.

• The largest infrastructure investment participation program, with $9 billion generated in four years.
• There is no comparable platform in developing economies for global long-only investors to participate in the fastest-expanding infrastructure projects.
• The program supported strategic targets, including the prepayment of margin-related share-backed funding. It provides the ability to equitize borrowed capital in a climate of rising interest rates.
• Committed to a 10-year capital program that began in 2016 and will be completed in 2025.

Adani Group began the capital transformation journey for its core infrastructure portfolio in 2019 and has raised more than $9 billion in four years. The program paved the way for long-only global investors to participate in the world’s largest and fastest-growing infrastructure development, with Adani portfolio companies spanning the infrastructure spectrum from energy and utility to transportation and logistics.