Adani Group shares deepen to $72 billion despite completion of share sale

Most Adani Group shares fell on Wednesday, after a short-seller report criticized the group and despite the group completing a closely watched share sale a day earlier that saw losses widen to $72 billion.

A Hindenburg Research report last week alleged improper use of offshore tax havens and raised concerns about high debt. It said shares of seven Adani listed companies have plunged 85% at what it called “sky-high valuations”.

The group, led by Gautam Adani, one of the world’s richest men, had denied the allegations and called them baseless, adding that it has always made necessary regulatory disclosures.

However, investors have sold off shares following the report, which has become one of the billionaire’s biggest business and reputational challenges.

“There was a slight bounce yesterday after shares sold off after what seemed impossible at one point, but now the weak market sentiment is visible again,” said Ambareesh Baliga, an independent market analyst in Mumbai.

“With shares falling despite Adani’s denials, it clearly shows some damage on investor sentiment. It will take some time to stabilise,” Baliga said.

Adani Enterprises lost 2% and Adani Transmission lost 3% on Wednesday. Adani Power fell 5%, while Adani Total Gas fell 10%, below its daily price range.

Adani Total Gas, a joint venture between France’s energy major Total and Adani Group, has been the biggest victim of short seller reports, losing nearly $27 billion in value since last Wednesday.

Adani Enterprises bounced in the last two sessions as the group received support from investors to push share sales of the flagship firm over the line on the last day of sale. The company still lost over $7 billion in value.

Hindenburg said in his report that he had shorted Adani Group’s US-bonds and non-India trading derivatives.