Adani Power, Adani Wilmar, Adani Enterprises, Adani Green: 7 Adani stocks lost Rs 55,000 cr in m-cap today. Here’s why

By admin On Jan 25, 2023

Shares of seven Adani group stocks lost Rs 55,000 crore in market capitalisation (m-cap) in Wednesday’s session after Reuters cited a report by short seller Hindenburg suggesting seven of the Adani group listed companies have an 85 per cent downside potential on a fundamental basis due to sky-high valuations.

Seven Adani group stocks namely Adani Total Gas, Adani Enterprises, Adani Transmission, Adani Green Energy, Adani Ports, Adani Power and Adani Wilmar together lost Rs 54,542 crore in market value following the report. Their combined m-cap stood at Rs 17.20 lakh crore compared with Rs 17.75 lakh crore a day ago.

Adani Ports lost 5.35 per cent to Rs 720 a piece, Adani Ports and Adani Wilmar lost over 4 per cent each. Adani Total Gas and Adani Transmission fell 3 per cent each. Adani Enterprises declined 2.5 per cent while Adani Green Energy was down 1.5 per cent. In m-cap terms, Adani Total Gas lost Rs 13,800 crore in market value, followed by Adani Transmission (down Rs 10,167 crore), Adani Enterprises (down Rs 9,604 crore), Adani Ports (down Rs 8,791 crore).

As per the Reuters report Hindenburg Research on Wednesday said it holds short positions in Adani group companies through and non-Indian-traded derivative instruments and US-traded bonds. The Reuters report quoted the Hindenburg Research note suggesting that key listed Adani companies have taken on substantial debt, including pledging shares of their inflated stock for loans, “putting the entire group on precarious financial footing”

Reuters reported that ealier Adani Chief Financial Officer Jugeshinder Singh had on January 21 said that “Nobody has raised debt concerns to us. No single investor has.” Adani Enterprises, the flagship company of ports-to-energy conglomerate Adani Group, has said it will raise $2.5 billion in India’s largest follow-on public offering due this Friday.

The report has emerged at a time Adani Enterprises is looking to raise Rs 20,000 crore via a follow-on public offer.

Ahead of the FPO, Gautam Adani, Adani Group Chairman, said the company’s strongest growth is still ahead. He said the mega FPO is part of a 10-year capital planning cycle supported by a de-risk growth plan that is aligned with India’s growth story and aligned with the group’s capabilities.

In a video message as part of the FPO road show, Adani said India is on its way to become a $30-trillion economy by 2050 and that his businesses are aligned with India’s ambitions of transitioning to ‘Bharat par Nirbhar’ (world dependent on India) from ‘Atmanirbhar Bharat’ (self-reliant India).

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