Shares in business tycoon Gautam Adani’s flagship firm nosedived again on Wednesday as the conglomerate fought short-seller allegations of accounting fraud.
Adani Enterprises stocks were down 30 per cent on the Bombay Stock Exchange minutes before the bourse’s scheduled close, their fifth straight day of losses.
The rout has wiped out around $92 billion of the value of the conglomerate’s listed units since last week, Bloomberg News said.
Mr Adani’s personal fortune has plummeted by more than $40 billion in the same period, dropping him out of the top 10 according to the real-time Forbes list. This meant Adani was no longer Asia’s richest man.
Adani Total Gas — in which French giant TotalEnergies owns 37.4 per cent — dropped another 10 per cent on Wednesday, forcing the Bombay Stock Exchange to suspend trade in the stock soon after the market’s open.
The sudden sharp drop in Adani Enterprises on Wednesday afternoon came despite a stock sale in the firm on Tuesday that was oversubscribed.
Smaller retail investors largely steered clear from the follow-on public offering.
Large buyers instead propped up the share sale, including fellow tycoons Sajjan Jindal and Sunil Mittal, Bloomberg News reported, citing unidentified sources.
Mr Adani, 60, has seen his empire expand at breakneck speed, with Adani Enterprises shares soaring by more than a thousand per cent in the past five years.
This helped make him, until last week, the world’s third-richest man behind Elon Musk and Bernard Arnault and family.
US investment group Hindenburg Research alleges that the Adani Group has artificially boosted the share prices of its units by funnelling money into the stocks through offshore tax havens.
This “brazen stock manipulation and accounting fraud scheme” is “the largest con in corporate history”, Hindenburg said in its explosive report issued last week.
The Adani Group said it was the victim of a “maliciously mischievous” reputational attack and issued a 413-page statement on Sunday that said Hindenburg’s claims were “nothing but a lie”.
Hindenburg, which makes money by betting on stocks falling, said in response that Adani’s statement failed to answer most of the questions raised in its report.
Adani said the report was driven by “an ulterior motive” to “create a false market” to allow the US firm make financial gains by dragging stock prices down.
(Disclaimer: New Delhi Television is a subsidiary of AMG Media Networks Limited, an Adani Group Company.)
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