[ad_1]
Adani Group stocks were mixed in Tuesday’s afternoon deals as Adani Enterprises, Adani Transmission, Adani Ports were trading higher while other Group stocks continued to decline, extending their three-day sell-off. The shares have tumbled after the Januart 24 report from U.S.-based Hindenburg Research which flagged concerns about high debt levels and the use of tax havens. Adani has called the report baseless. Meanwhile, Adani’s ₹20,000 crore follow-on public offer (FPO) is being offered at a premium price band of ₹3,112 and ₹3,276 per FPO equity share, will close on January 31st.
Adani Ent falls 25%
Adani Enterprises’ share prices fell as low as ₹2,081.75.
Adani Ent share price hits 15% lower circuit
Compared to the previous closure of ₹2,975, the price of Adani Enterprises’ stock touched a 15% lower circuit at ₹2,528. The stock rose when it began trading at ₹3,030, but it was unable to hold its gains in the morning and lost more throughout the day.
Credit Suisse’s private bank stops margin loans on Adani bonds
In response to allegations of fraud by short seller Hindenburg Research, Credit Suisse Group AG has stopped accepting bonds from the Adani Group of Companies as collateral for margin loans to its private banking clients. This is a sign that the Indian tycoon’s finances are coming under closer scrutiny.
‘“Adani, Adani’ chants interrupt Budget speech
FM Nirmala Sitharaman’s Budget speech was briefly interrupted by chants of “Adani, Adani” from the opposition benches.
This budget is for Adani
This budget is for Adani, Ambani, Gujarat, said Congress’ K Suresh.
Mukesh Ambani surpasses Gautam Adani
Mukesh Ambani now richest Indian
Mukesh Ambani has overtaken Gautam Adani as the richest Indian in the world, according to the Forbes Real-time Billionaires list.
Markets ‘overpricing’ Indian banks’ risk from Adani exposure
Markets are “overpricing” the risk to Indian lenders from their exposure to Adani Group, Reuters quoted Societe Generale said. “India’s banking sector has been one of the hardest hit by the collateral damage from the sharp correction in the Adani group stocks over the past week post the Hindenburg report,” Reuters quoted SocGen strategists as saying.
Most Adani Group stocks dropped, extending losses to $72 billion
Most Adani Group stocks dropped on February 1, extending losses to $72 billion.
Adani Ports completes acquisition of Oiltanking India GmbH
Adani Ports and Special Economic Zone (APSEZ) has completed the acquisition of Oiltanking India GmbH’s 49.38% equity stake in IOTL and Oiltanking GmbH’s 10% equity stake in IOT Utkal Energy Services Ltd, a subsidiary of IOTL.
Bailout not success: Sandip Sabharwal
In a cryptic tweet, a day after the Adani FPO was fully subscribed, Sandip Sabharwal of Asksandipsabharwal.com said: “A bailout is a bailout Its not a success…..(sic)”
Gautam Adani thanks investors after FPO gets fully subscribed
Gautam Adani has thanked investors after Adani Enterprises FPO got fully subscribed. Adani Enterprises FPO was over-subscribed on the final day of the ₹20,000 crore issue, aided by a last-minute surge in demand.
#IndiaStandsWithAdani trends amid Hindenburg controversy
In response to the $65 billion in stock losses for the Adani Group since last week’s Hindenburg Research study, which raised worries about its high debt levels and usage of tax havens, #IndiaStandsWithAdani was among the top trending hashtags on Twitter.
Adani Enterprises slips over 4%
Adani Enterprises has slipped over 4% from opening high.
Adani Total Gas hits Lower circuit again
Adani Total Gas has hit Lower circuit for the fourth consecutive session.
Irregularities in Adani Dhamra project: Mahua Moitra
TMC MP Mahua Moitra claims she hasn’t gotten any response from Central Vigilance Commission against her November 2019 letter on irregularities in Adani Dhamra project.
Adani FPO fully subscribed
Even though the Adani FPO traded 9% below the FPO price, it was fully subscribed. Family offices of UHNIs including Reliance, Airtel, JSW, Zydus and Torrent Pharma made stakes in it.
Gautam Adani may lose title of Asia’s richest man
Just a few billion dollars will separate Gautam Adani from the title of Asia’s richest man. If he loses the title, it will likely go to Reliance Industries Chairman Mukesh Ambani, Fortune reported.
Gautam Adani meets Israeli PM
Gautam Adani met Israeli Prime Minister Benjamin Netanyahu as, on January 31, the Adani Group acquired the strategic Israeli port of Haifa for $1.2 billion.
Australian securities regulator reviewing Hindenburg’s allegations against Adani
Hindenburg Research’s report accusing the Adani Group of improperly using offshore tax havens is being examined by the Australian Securities & Investments Commission (ASIC) to see whether any regulatory action is necessary.
Hindenburg rarely faces defamation lawsuits
Among the 20-odd companies Hindenburg has targeted in research reports published since 2017, only two have actually taken it to court for defamation. The year 2019 saw the dismissal of both of those lawsuits, one from Bollywood film production Eros International and the other from China-based real estate developer Yangtze River Port and Logistics, as per Reuters. The report comes as Adani is reportedly considering a lawsuit against the short-seller in the US.
Adani’s Hindenburg fallout might cast a shadow on Indian Budget presentation
“India is set to unveil a budget that will chart a path for sustained robust growth and fiscal prudence although the fallout from Hindenburg Research’s allegations on the Adani Group poses an overhang on the presentation”, said Bloomberg
The Indian government is poised to present a budget that balances robust growth with fiscal responsibility, despite the recent controversy surrounding Hindenburg Research’s allegations against the Adani Group. The Finance Minister, Nirmala Sitharaman, will unveil the budget for the upcoming financial year starting April, which is expected to exceed $544 billion.
This budget will address job creation, social welfare funding, and incentives for manufacturing. It is the last full-year budget ahead of Prime Minister Narendra Modi’s bid for a third term in the upcoming 2024 elections.
Haifa Port handover: ‘Element of a long string of future cooperation in the economic field’, says Israel ambassador
The handover of Israel’s Haifa Port by Israeli Prime Minister Benjamin Netanyahu to the Adani Group Chairman, Gautam Adani, has been celebrated as a symbol of trust between the two countries. The event was marked by a special ceremony in Israel and was described by the Israeli Ambassador to India, Naor Gilon, as an “element of a long string of future cooperation in the economic field”.
Haifa Port is considered a strategic asset for Israel and its transfer to the hands of a major Indian company such as Adani is seen as a significant step forward in the relationship between the two nations. The Israeli envoy expressed his hope that this investment will be only the beginning of a long-standing economic cooperation between the two countries. The handover of the Haifa Port reflects the growing trust and cooperation between India and Israel and is expected to lead to further economic opportunities for both nations.
(With inputs from ANI)
Adani FPO sails through with help from fellow industrialists
Billionaire Gautam Adani-led group’s ₹20,000 crore share sale in its flagship firm sailed through on the last day after investors, some being family offices of fellow industrialists, rallied behind the embattled tycoon, whose business empire has been rocked by allegations of fraud by a US short seller.
While the portion of a follow-on share sale in Adani Enterprises Ltd reserved for anchor investors was fully subscribed last week, institutional and other non-retail investors helped the offer reach desired subscription levels hours before the sale closed, according to data available from BSE.
As many as 5.08 crore shares were sought against an offer of 4.55 crore, even though the offer price was higher than the rate at which the company stock was being traded on the stock exchange.
Non-institutional investors put in bids for over three times the 96.16 lakh shares reserved for them, while the 1.28 crore shares reserved for qualified institutional buyers (QIBs) were subscribed 1.2 times, according to BSE data.
There was, however, a muted response from retail investors and company employees.
With PTI inputs.
Adani FPO: What saved the issue on the last day of bidding?
Just about a week ago, the Street was awaiting India’s largest follow-on-public offer (worth ₹20,000 crore) which was about to be floated by one of the India’s biggest conglomerates. Investors – retail and institutional – were waiting for the issue to open to buy shares of Adani Enterprises at a bit of a discount from the market price.
Read MORE here.
Deepak Jasani on Adani group stocks
According to Deepak Jasani, Head of Retail Research, HDFC Securities, Adani group companies saw a fall in their market prices over the last few days as doubts arose about the safe completion of the ₹20,000-crore FPO from Adani Enterprises following the report released by Hindenburg making allegations against the group.
“Margin call sales and selling by fence sitters added to the panic in some Adani group stocks. This also impacted the sentiments in the broader markets.
“However, now that the FPO has sailed through, one concern faced by the markets will be over for the time being and the focus of the markets will shift to other triggers like Union Budget, corporate results, US Fed meet outcome and RBI MPC meet outcome,” Jasani said.
Sebi discussed Adani firms with ratings agencies
Securities and Exchange Board of India met with ratings agencies to discuss Adani Group companies, according to a Bloomberg report.
Netanyahu says Adani to increase Israeli investment ‘in a big way’
Gautam Adani plans to increase his investment in Israel “in a big way,” Israeli Prime Minister Benjamin Netanyahu said on Tuesday at a ceremony marking Adani’s purchase of Haifa port.
CEA Nageswaran refuses to comment on Adani controversy
India’s chief economic adviser has declined to comment on allegations against the Adani Group’s business practices by a US short seller and the subsequent sharp fall in the shares of the business house. “We do not comment on any single company”, Nageswaran said at a press conference, adding that the matter was between the markets and the group.
Adani FPO sails through
Adani Enterprises FPO has been fully booked on the last day of the subscription on Tuesday with 1.02x subscription , as per BSE data as of 3:10 pm, led by strong demand from NIIs, QIBs
FPO inches to full subscription
Adani’s ₹20,000 crore-share sale inched closer to full subscription on Tuesday as investors pumped in funds after a tumultuous week for his group in which its stocks were pummeled by a scathing short-seller report
Offer booked 0.83 times
As of 2:30 pm, the offer has been subscribed 0.83x, with retail category booked 0.09x, NIIs 2.43x, QIBs nearly 1x, and employee reserved 0.42x, as per the BSE data
FPO needs at least 90% subscription to go through
With the 30% anchor investor book that closed last week, the issue is now subscribed 70%, Indian stock exchange data showed. The share sale needs at least 90% subscription to go through
Institutions pump in funds in share sale
Demand from retail investors remained muted, garnering bids only worth around 8% of the shares on offer for that segment. On Tuesday, demand came from foreign institutional investors (FIIs), as well as corporates who bid in excess of 1 million rupees each, data showed, as reported by Reuters
Adani FPO update
As of 1:35 pm, the offer has been subscribed 0.56x, with retail category booked 0.08x, NIIs 1.16x, QIBs 1.75x, and employee reserved 0.38x, as per the BSE data
Adani Group pledges more shares of Ports unit
The Adani Group pledged more shares of its ports arm to lenders.
Flourishing Trade and Investments Ltd encumbered 0.56% more shares of Adani Ports to Catalyst Trusteeship Ltd, according to an exchange filing. Catalyst, which is acting as a security trustee on behalf of lenders, now holds 5.11% shares of the port operator under pledge
Adani Enterprises FPO subscribed 36% as of 1 pm
As of 1 pm, the offer has been subscribed 0.36x, with retail category booked 0.08x, NIIs 0.62x, QIBs 0.68x, and employee reserved 0.32x, as per the BSE data
FPO ‘critical’ for Adani
The FPO is critical for Adani, not just because it is India’s largest follow-on offering and will help cut debt, but also because its success will be seen as a stamp of confidence by investors at a time the tycoon faces one of his biggest business and reputational challenges of recent times
Adani Power, Adani Green, Adani Total Gas stocks fall
Adani Power, Adani Green, Adani Wilmar Adani Total Gas, were down 5%-10%, extending their falls
Ambuja Cements, ACC shares rise
Ambuja Cements climbed over 5% and ACC gained nearly 3%. The Adani Group last year bought cement firms ACC and Ambuja Cements from Switzerland’s Holcim for $10.5 billion.
Adani FPO subscription update
As of 12 pm, the offer has been subscribed 0.20x, with retail category booked 0.06x, NIIs 0.17x, QIBs 0.49x, and employee reserved 0.24x, as per the BSE data
Mahua Moitra writes to SEBI again after claiming Hindenburg used her letters as part of their investigative work
TMC leader Mahua Moitra had claimed that Hindenburg has used her letters as part of their investigative work. Now, she said she has written to market regulator SEBI again on her previous queries. “Written to @SEBI_India again today wanting some long awaited answers to my previous queries,” she tweeted
Adani Transmission, Adani Ports shares rise
Shares of Adani Transmission and Adani Ports bounced back from lows to trade higher on the BSE
Adani Ports clarifies on reports of Ambuja, APSEZ buybacks plans
Adani Ports and Special Economic Zone Ltd (APSEZ) on Tuesday issued clarification to the exchanges on reports of Adani Group’s potential plan of ₹3,000 crore Ambuja, APSEZ buybacks. “We would like to clarify that there is no such plan and hence, we are not in a position to comment on the veracity of said media report,” it said. Read here
Adani FPO subscription status on last day
As of 10:40 am on last day, Adani Enterprises FPO has been subscribed 0.06 times with retail category booked 0.05x, NIIs 0.17x, employee reserved 0.18x, as per BSE data
Gautam Adani out of top 10 billionaires list
Gautam Adani has lost his position in the world’s top 10 richest list and now stands at the 11th position with his net worth at $84.4 billion, as per the Bloomberg Billioniares Index. Read here
Adani stocks rout impact on India’s stock market
Rout in Adani Group shares has dragged the India’s stock market to the worst performer in Asia this year, reported Bloomberg. After outperforming global peers over the past two years, Indian stocks have fallen amid interest-rate hikes and most recently sentiment has suffered from a short-seller campaign against Gautam Adani’s business empire
PNB’s exposure to Adani Group
Punjab National Bank (PNB) has a total exposure of 70 billion rupees ($859.30 million) to Adani Group, but there is currently no worry pertaining to those accounts, PNB CEO Atul Kumar Goel told reporters at a virtual press conference after the company’s quarterly results
Adani Group stocks update
Adani Enterprises surged over 3%, top Nifty gainer on Tuesday, on the last day of the FPO. Meanwhile, other Group stocks, including Adani Transmission, Adani Green, Adani Wilmar continued to decline on the BSE
Wilmar vows to stand by its venture with Adani Group
Food giant Wilmar International Ltd. will continue to support its joint venture (JV) with Adani Group, saying a report from short-seller Hindenburg Research had not raised any issues specific to the unit.
The day-to-day operations of Adani Wilmar Ltd are managed by an independent team of professional managers and the board is chaired by an independent director, Singapore-based Wilmar said in an emailed response to questions from Bloomberg News. Read here
Adani Enterprises FPO closes today
Adani Enterprises shares have plunged about 7% below the floor price set for the follow-on public offer (FPO) amid three-day selloff in Adani Group stocks. Overall subscription for the offer sale, stood at 3% as of end Monday
FTSE Russell on Adani Group stocks
Global index publisher FTSE Russell said on Tuesday it was aware of short-seller Hindenburg Research’s report on the Adani Group and associated securities and that it was monitoring the information.
“Adani index constituents within the FTSE Russell indices will continue to remain eligible in accordance with the underlying index methodologies,” it said in a notice published on its website. Read here
Adani group shares have fallen over the past three trading sessions
Most Adani group shares have fallen over the past three trading sessions after Hindenburg Research released a damning report that flagged concerns around debt and the use of tax havens at the ports-to-energy conglomerate
Adani dollar bonds rally from record lows
Adani Group companies rebounded in the dollar bond market after some dropped to record lows the day before, following a vote of confidence in the Indian conglomerate from Abu Dhabi’s International Holding Co
Daily circuit limit revised on three Adani Group stocks
NSE has revised the circuit limits on Adani Transmission Ltd, Adani Total Gas Ltd and Adani Green Energy Ltd and has lowered it to 10% from 20%. Read here
Adani conglomerate plans independent audit of group companies
The Adani Group plans to hire one of the “big six” global accounting firms to evaluate its corporate governance and audit practices following allegations of fraud by US short seller Hindenburg, sources told Mint. Read here
Adani firms lose $65 billion in value as US short-seller battle escalates
Most Adani Group shares fell sharply on Monday, deepening a market rout that has now led to losses of $65 billion in the group’s stock values. Read more here
Adani crisis unlikely to have any impact on Bengal’s Tajpur port project
Business chambers in Kolkata said the Adani Group crisis is unlikely to affect the proposed ₹15,000 crore deep sea Tajpur port construction, a major infrastructural project of West Bengal. State Chief Minister Mamata Banerjee handed over the letter of intent of the project to Adani Ports in October last year.
LIC says it has exposure of ₹36,474.78 cr to Adani group
LIC on Monday said it has an exposure of ₹36,474.78 crore to Adani group’s debt and equity, and the amount is less than one per cent of the national insurer’s total investments. LIC’s total assets under management stood at over ₹41.66 lakh crore as of September 2022.
Adani rout hits $68 bn as fight with Hindenburg intensifies
Gautam Adani’s 413-page attempt to restore confidence in his business empire is falling flat with investors, as stock-market losses deepen and key dollar bonds sink to fresh lows.
Dalal Street veteran Shankar Sharma on Adani Group stocks
Adani’s issue likely to be discussed in Parliament
According to a PTI report, opposition parties on Monday raised the Adani issue and the conduct of governors in some states ruled by them at an all-party meeting on the eve of Parliament’s Budget Session as the government asserted it was willing to discuss every matter allowed by rules and sought their cooperation in the Parliament during this budget session.
LIC’s exposure in Adani Group’s equity and debt
The majority of Adani Group’s stocks are in a bloodbath and Monday was no different after Hindenburg hit back at the conglomerate’s response to their allegations. Amidst this panic selling, investors have lost hefty in Adani stocks. The largest life insurer in India, LIC also has exposure in the Adani Group.
LIC said it has an exposure of ₹36,474.78 crore to Adani group’s debt and equity, and the amount is less than 1% of the national insurer’s total investments, as per the PTI report.
LIC likely to not participate in Adani’s FPO
India’s largest life insurer, LIC, one of the major shareholders in a couple of Adani’s companies, is likely to not participate in the ongoing $2.5 billion FPO.
Sources have told Reuters that LIC will not go (bid) for institutional quota at present. It added that LIC is taking a cautious approach and the board had only approved the anchor bid.
Both LIC nor the country’s finance ministry have not responded to Reuters queries immediately.
However, LIC has already announced that they are reviewing Adani’s response to Hindenburg’s allegations which brought the conglomerate’s listed stocks under pressure. Also, LIC is looking to meet Adani’s management within days.
Abu Dhabi’s IHC sees strong potential for growth in Adani Enterprises
While announcing its plan to infuse approximately $400 million in Adani’s ₹20,000 crore FPO, Syed Basar Shueb, Chief Executive Officer, IHC said, “Our interest in Adani Group is driven by our confidence and belief in the fundamentals of Adani Enterprises.”
IHC CEO added, “we see a strong potential for growth from a long-term perspective and added value to our shareholders.”
Shueb explained that the advantage of the FPO is the historical reference for the company’s earnings report, company’s management, business practices, and much data to bank on before making any investment decision.
FPO subscribed by 3% on the second day
Adani’s ₹20,000 crore FPO received a little over 3% subscription on the second day of the issue. As per BSE data, the FPO received cumulative bids of 13,98,516 equity shares against the offered size of over 4.55 crore equity shares.
Of the total, retail investors continue to be top bidders with the category subscribing to the FPO by 4% with bids of 9,76,944 equity shares against the reserved portion of 2,29,08,464 equity shares.
Non-institutional investors portion received bids of 3,95,832 equity shares on Day 2 against the reserved size of 96,16,323 equity shares.
The demand from both retail and non-institutional investors picked up marginally on Monday.
However, qualified institutional buyers (QIBs) continued to show dull responses to the FPO — with the portion recording bids of merely 4,576 equity shares against the reserved size of 1,28,21,336 equity shares for this category.
IHC to invest 1.4 billion AED in Adani Enterprises FPO
International Holding Company, the diversified Abu Dhabi-based conglomerate, on Monday announced its plan to invest AED 1.4 billion ($ 400 million) into the Adani Enterprises further-public offering (FPO) through its subsidiary Green Transmission Investment Holding RSC.
LIC reviews Adani’s response to Hindenburg’s allegations
LIC on Monday revealed that they are reviewing Adani Group’s over 400-page response to allegations raised by Hindenburg Research. Also, LIC plans to hold talks with the conglomerate’s management within days. The government-backed life insurer has pumped in 364.7 billion rupees ($4.47 billion) in Adani companies — which accounts for 1% of its assets under management.
Read here: LIC reviews Adani’s response to Hindenburg, plans to meet group’s management
Adani’s mix effect on stock market
Vinod Nair, Head of Research at Geojit Financial Services:
The response by Adani had a mixed effect on the stock group and market. The saga is likely to continue as a hanging risk in the minds of the investors in the medium-term. To expect a scientific assessment report either by a strong independent third party or government is dim in the short-term. Now the focus of the market will be on budget and fed policy.
M-cap of Adani stocks post closing on Monday.
After the closing hours, Adani Group’s stocks recorded a ₹1,53,502.39 crore erosion in market cap on Monday. Adani Enterprises m-cap rises.
Adani Total Gas: This would be the most valued firm in Adani’s ambit in terms of market share. Its market cap stood at ₹2,58,196.91 crore by Monday-end, compared to ₹3,22,744.77 crore on January 27th — recording an erosion of ₹64,547.86 crore.
Adani Enterprises: M-cap rose by ₹13,263.91 crore to ₹3,28,149.32 crore on Monday, compared to ₹3,14,885.41 crore on January 27th.
Adani Green Energy: M-cap down by ₹47,014.08 crore — taking the tally to ₹1,88,135.54 crore on Monday versus ₹2,35,149.62 crore on January 27th.
Adani Transmission: M-cap slip by ₹33,420.16 crore — taking the total to ₹1,90,760.4 crore on Monday — compared to ₹2,24,180.56 crore of last week’s Friday.
Adani Ports: This company faced the lowest erosion in m-cap by ₹378.03 crore to ₹1,28,927.89 crore compared to ₹1,29,305.92 crore on January 27th.
Adani Power: M-cap dipped by ₹4,782.6 crore to ₹90,888.77 crore by end of Monday’s session, from ₹95,671.37 crore of last week’s Friday.
Adani Wilmar: M-cap plunged by ₹3,359.66 crore on Monday to ₹63,872.71 crore from ₹67,232.37 crore of last week’s Friday.
After volatile session, Ambuja, ACC stock end higher
Adani’s cement companies, Ambuja Cements closed higher by 2% at ₹387.45 apiece. Notably, Ambuja stock gained nearly 12% in the early deals with an intraday high of ₹426.30 apiece before entering the volatile tone. This led to a seesaw performance in Ambuja with the stock also tumbling by nearly 8% with an intraday low of ₹351.70 apiece.
Adani has clarified that no Ambuja Cement shares have been pledged due to SEBI’s strict rules stake is considered encumbered.
A similar pattern was seen in ACC shares. This stock ended at ₹1,904.70 apiece up by 1.10%on BSE. However, in early deals, the stock had gained by nearly 10% with an intraday high of ₹2,072.45 apiece, but later in the day, it tumbled as much as 4.5% with an intraday low of ₹1,800 apiece.
In September last year, Adani became the second largest cement player in the country by acquiring Ambuja and ACC from Holcim for 6.4 billion dollars.
Except Adani Enterprises, all other Adani Group stocks end lower
After a volatile session, Adani Enterprises’ share price ended higher by 4%. Earlier in the day, the stock had touched 10% upper circuit. The ₹20,000 crore FPO picked up momentum, however, at a slower pace.
Adani Ports erased its 10% upper circuit gains and closed marginally lower at ₹596.85 apiece on BSE.
Adani Power and Adani Wilmar close at 5% lower circuit.
Adani Transmission ended 15% lower after touching a new 52-week low of ₹1607.80 apiece.
Adani Green and Adani Total ended at 20% lower circuit.
LIC to hold talks with Adani management in Hindenburg matter
The largest life insurer in India, LIC told Reuters on Monday it was reviewing the Adani group’s response to Hindenburg’s report and would hold talks with the management within days.
Managing Director Raj Kumar said, “Since we are a large investor we have the right to ask relevant questions.”
Adani bonds stumble
After Hindenburg’s counter report over Adani’s 418-page response, the Group’s bonds also took a massive hit.
All of the Adani bonds are currently trading with a cut of 1% to 5%.
Hindenburg also holds short positions in Adani Group Companies through U.S.-traded bonds and non-Indian-traded derivatives, along with other non-Indian-traded reference securities.
7 Adani stocks see erosion of over ₹1.75 lakh cr m-cap
Due to a frenzied selloff, Adani Group’s seven listed stocks witnessed an erosion of over ₹1,75,522 crore in market valuation on Monday.
Adani Total Gas and Adani Green shares are locked at a 20% lower circuit and saw their market cap drop by ₹64,547.86 crore and ₹47,029.92 crore compared to the previous session. Adani Enterprises who has launched the FPO erased early gains and was trading lower by 2%, with m-cap diving by ₹5,796.91 crore.
Meanwhile, Adani Transmission not only touched a 20% lower circuit but also a new 52-week low. The company’s m-cap slipped by ₹44,831.65 crore from the previous session.
Adani Wilmar and Adani Power’s market cap has declined by ₹3,359.66 crore and ₹4,782.6 crore from the previous day. These two stocks have touched a 5% lower circuit for the third day in a row.
Adani Port shares are also down, and its market cap has dropped by ₹5,173.54 crore.
Some Adani stocks hit 1-year low
Adani Green Energy, Adani Transmission among 174 BSE stocks to touch 52-week lows, 74 stocks hit 52-week highs.
FPO to fully subscribe by today?
Basant Maheshwari of The Equity Desk said, “For the moment, the current situation of Adani Group and the overall market to quite an extent has improved.” He added,” I believe the problem has been solved, and for the moment, everything is good..all is well.”
Maheshwari believes now the focus should be on the FPO and to see when the issue gets subscribed. He said, “I believe, today only, the FPO will be fully subscribed.” He added, “The current price levels indicate that FPO will probably be fully subscribed….”
LIC shares continue to dip
LIC shares continue to trade in red for the third consecutive day amidst a sharp selloff in Adani stocks.
Currently, the insurer’s stock is trading at ₹653.75 apiece down by 1.8% on BSE. In early trade, LIC shares dip nearly 4% with an intraday low of ₹639.70 apiece.
LIC has likely witnessed massive losses in its position in Adani after Hindenburg’s allegations pushed investors to carry panic selling since January 24 in the group’s listed stocks.
By end of the December 31, 2022 quarter, LIC holds 4.23% of Adani Enterprises, 9.14% of Adani Ports, 3.65% of Adani Transmission, 1.28% of Adani Green Energy, and 5.96% of Adani Total Gas.
Bank Nifty under pressure
Amidst the chaos in Adani stocks, Bank Nifty erased its psychological mark of 40,000 in early deals. Private banks take the most beating.
At the time of writing, Bank Nifty was trading at 40,154.65 lower by 190.65 points or 0.47%. In early trade, the index had touched an intraday low of 39,658.85, while it opened at 39,856.15.
IndusInd Bank stock was the top bear, dipping by over 2.5%. ICICI Bank, SBI, and HDFC Bank followed with nearly a percent drop each. Stocks like PNB, Bandhan Bank, IDFC First Bank, and AU Small Finance Bank were top gainers.
Banking stocks have come under pressure after panic arose about their exposure to Adani Group’s debt levels.
According to a CLSA report, even though Adani Group’s debt levels doubled from ₹1 lakh crore to ₹2 lakh crore in the past three years, the overall bank debt increased by more than 25 percent. The Indian banks’ exposure to debt is less than 40% and that of private banks is less than 10%.
Gautam Adani has no idea of funds flowing from Vinod Adani to group?
Hindenburg found Adani’s on response on Vinod Adani’s involvement with the Group, as “lack of direct and transparent answers to these questions telling.”
The US firm cited Adani’s response of “We are neither aware nor required to be aware of their ‘source of funds’”. It also added that it is “not in a position to comment on…allegations on the business dealings and transactions of Vinod Adani.”
Following this, Hindenburg said, “we are expected to believe that Gautam Adani has no idea why his brother Vinod lent massive sums of money to Adani entities, and no idea where the money originated from.”
“If any of that were true, Gautam could easily clear up the mystery by calling his brother, or asking him at the next family dinner, why he has been directing billions of dollars to Adani-controlled entities through a network of opaque offshore shell entities. He could also call the head of his own Family Investment Office and ask the same.”
Read here: Hindenburg’s allegations against Gautam Adani’s brother Vinod Adani. 8 points
Markets weekly outlook
Manish Chowdhury, Head of research at Stoxbox:
We feel that though markets can see some respite after two days of sell-off, there is some pain left in the markets before it stabilizes. We feel that investors should adopt a wait and watch approach atleast for the next week when there are two major events lined-up viz-a-vis Union budget and the US Federal Reserve interest rate decision. Though the budget is mostly expected to be pro-growth, the US Fed looks in a conundrum over the size of the rate hike. With lots of noise around Adani Group shares over the last two days, it is advisable for investors to stay away from them till clarity emerges on the various controversial remarks from the US-based Hindenburg Research.
What to expect in Adani stocks?
Nirav Karkera, Research Head at Fisdom:
Adani group stocks have been challenging investor sentiments through a variety of concerns. Right from a burgeoning debt structure to rich or grotesquely expensive valuations depending on the entity and valuation methodology employed, these concerns have pushed investors to the edge of their seats. However, the recent report seems to be the straw that broke the camel’s back.
With the ongoing FPO priced at a premium to AEL’s post-correction share prices and the group’s stance to continue with the FPO schedule and pricing exudes confidence, but a reflection of the same in investor sentiment is questionable.
The initial and sharp decline appears to be majorly led by individual investors, some domestic institutions, and trading entities. The bulk of ownership across most entities belonging to the group is retained by select domestic and foreign institutions and other promoter group entities.
With such a steep drawdown already taken effect and the slim probability of institutional entities selling at this point, prices could move largely within the range unless further developments trigger otherwise.
Going ahead, we expect the stock prices to remain range-bound with limited downside and potential to surprise strongly on the upside.
Markets extend losses as selling heightens in Adani stocks
Although markets opened on a lower note, they picked up momentum after Adani Enterprises and Adani Ports’ share price touched the 10% upper circuit in the early deals.
However, markets have now extended losses as frenzied selling intensified in Adani Group’s stocks.
Adani Ports have erased its gain and is trading lower by 1%. Adani Transmission and Adani Total Gas are locked at 20% lower circuits. Adani Wilmar and Adani Port shares are frozen at a 5% lower circuit. Adani Green is down by nearly 19%.
While Adani Enterprises too have pulled back from its 10% upper circuit and is currently up by a little over 3%.
Sensex is trading at 59,213.37 down by 117.53 points or 0.20%. Nifty 50 traded at 17,568.25 lower by 36.10 points by 0.21%.
Retail investors are top bidders in FPO
In the early deals on Monday, Adani’s FPO received bidding of about 5,83,820 equity shares, at around 11.09 am, as per BSE data. This is compared to the offered size of over 4.55 crore equity shares.
Overall, the bidding in the FPO is at a slower pace.
Of the total bids received so far, retail investors lead the FPO with more than 5 lakh bids in the issue so far. As per the data, the retail investors’ portion received 5,00,908 bids against the reserved size of 2,29,08,464 equity shares. On the other hand, the portion for non-institutional investors received bids of 68,452 equity shares against the reserved size of 96,16,323 equity shares. The demand from qualified institutional investors has continued to stay dull.
Adani Group’s CFO Jugeshinder Singh
In a media interaction, Adani Group’s CFO Jugeshinder Singh said, the Group has given the responses to market regulator Sebi. Once they get any information, they will accordingly disclose it on exchanges.
He also stated that whether Sebi or Attorney General wants to take action in the matter, depends on both of them.
Adding he stated that the Group’s objective has been done, and we have given point by answers to every question along with documents.
It took Hindenburg 2 years, we took two-three days to answer those questions, Singh said.
No change in FPO priceband, timeline
Adani group has clarified that there will be no change in the FPO priceband and timeline. For the company FPO demand was never a concern and expect a full subscription
Out of the total $30 billion debt only or 23% or $9billion is from Indian banks, making it ₹72,000cr
No Ambuja Cement shares have been pledged due to SEBI’s strict rules stake is considered encumbered
Moses Harding John, President & CEO of IndusInd International Holdings response on the matter
John tweeted, “post-Adani’s response (to Hindenburg) establishing the group as systemic important player in growth & prosperity of Indian economy (notwithstanding issues around valuation & debt and lack of great confidence on governance), let good sense prevail in overall equity markets!”
Adani Group’s response on allegations on Vinod Adani
In its 418 page response, Adani gave a common response saying, “Vinod Adani does not hold any managerial position in any Adani listed entities or their subsidiaries and has no role in their day to day affairs. As such, these questions have no relevance to the entities in the Adani portfolio and we are not in a position to comment on your allegations on the business dealings and transactions of Vinod Adani.”
It added, “We reiterate that any transactions by the Adani portfolio companies with any related party have been duly identified and disclosed as related party transactions in compliance with Indian laws and standard and have been carried out on arm’s length terms.”
Did Vinod Adani lent massive sum of money to Adani Group?
Among a series of allegations, Hindenburg specifically brought attention to funds that flowed from Vinod Adani’s associated offshore shell entities through the Adani Group.
Hindenburg gives two examples. Firstly, a 253 million loan from a Mauritius entity where Vinod Adani serves as a director. Secondly, an investment of $692.5 million from a Mauritius entity controlled by the head of the Adani Group’s Private Family Investment Office.
In total, Hindenburg found 38 Mauritius-based entities associated with Vinod Adani and Subir Mittra (the head of the Adani private family office). Also, they found out that Vinod Adani’s associated entities are in other tax haven jurisdictions like Cyprus, the UAE, Singapore, and various Caribbean islands.
Hindenburg’s latest reply is that, “this information is critical to the integrity of Adani’s business, as it indicates whether the company is round-tripping turnover, laundering illicit funds, or using cash to manipulate its stock.”
Adani defense: Vinod Adani is not related party to the Group
To its allegations on billionaire Gautam Adani’s brother Vinod Adani, Hindenburg said, “Adani bizarrely argued that Vinod Adani is not a related party to the Adani Group and that there are no disclosable conflicts relating to the transactions that have collectively moved billions of U.S. dollars through Adani Group entities, largely through offshore shell entities.”
Allegations on Gautam Adani’s brother Vinod Adani
Hindenburg alleged that Adani Group has engaged in billions of dollars in suspicious dealings with its Chairman’s brother, Vinod Adani, and his labyrinth of offshore shell entities.
These entities included 38 entities in Mauritius, along with others in the UAE, Cyprus, Singapore, and various Caribbean islands.
Hence, these dealings raised serious questions about stock and accounting manipulation.
Adani stocks to dominate markets
Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services said, “Today the market will be completely dominated by the movements in Adani stocks. The statement from Adani Enterprises that the FPO is on schedule and that there is no change in the price band is hugely important. This can be interpreted as a reflection of the confidence of the management in the success of the FPO. It is important to understand that the stock has limited public float. So, the price crash on Friday happened mainly due to shorting Adani stocks in general and Adani Enterprises in particular.”
Vijayakumar added, “One possibility is a big short-squeeze in the stock. Huge volatility is in store in Adani stocks today. The sustained selling by FPIs in January with a massive sell figure of ₹5978 crores last Friday is a bit intriguing. Did the FPIs get wind of the storm blowing now? It is important to note that during the last 3 days while Nifty declined by 3.2 %, Bank Nifty declined by 6.3% on concerns of the Adani crisis impacting the banks. The correction in high quality private sector banks is a buying opportunity. Investors may wait for the dust to settle.”
Adani failed to answer 62 of Hindenburg’s 88 questions
Hindenburg says, “Our report asked 88 specific questions of the Adani Group. In its response, Adani failed to specifically answer 62 of them. Instead, it mainly grouped questions together in categories and provided generalized deflections.”
“Of the few questions it did answer, its responses largely confirmed our findings, as we detail,” the firm said.
Read here: ‘Myths of short seller’: Adani gives point by point reply to Hindenberg’s allegations
Hindenburg: Fraud is Fraud
According to Hindenburg’s latest reply, Adani Group predictably tried to lead the focus away from substantive issues and instead stoked a nationalist narrative, claiming that their report amounted to a “calculated attack on India.” In short, the Adani Group has attempted to conflate its meteoric rise and the wealth of its Chairman, Gautam Adani, with the success of India itself.
“We disagree. To be clear, we believe India is a vibrant democracy and an emerging superpower with an exciting future. We also believe India’s future is being held back by the Adani Group, which has draped itself in the Indian flag while systematically looting the nation,” the US-based firm said.
Hindenburg added, “We also believe that fraud is fraud, even when it’s perpetrated by one of the wealthiest individuals in the world.”
Hindenburg’s response to Adani’s 413-page statement
Hindenburg has replied to Adani Group’s 413-page statement on Sunday.
The US-based company released another report titled: “Fraud cannot be obfuscated by nationalism or a bloated response that ignores every key allegation we raised.”
“Adani also claimed we have committed a “flagrant breach of applicable securities and foreign exchange laws.” Despite Adani’s failure to identify any such laws, this is another serious accusation that we categorically deny,” Hindenburg’s note said.
Hindenburg pointed out that Adani’s ‘413 page’ response only included about 30 pages focused on issues related to their report.
The remainder of the response of Adani, Hindenburg said, “consisted of 330 pages of court records, along with 53 pages of high-level financials, general information, and details on irrelevant corporate initiatives, such as how it encourages female entrepreneurship and the production of safe vegetables.”
Adani Total Gas worst hit
Adani Total Gas share price is the worst hit on Monday, nosediving to its 20% lower circuit before correcting.
Adani Green Energy has tumbled by nearly 19%, while Adani Transmission has shed nearly 18% so far in the early deals on BSE.
Adani Power, Adani Wilmar hit another 5% lower circuit
Adani Power and Adani Wilmar hit 5% lower circuit for the third consecutive day on Monday.
At present, Adani Power is trading at ₹235.65 apiece and Adani Wilmar at ₹491.45 apiece on BSE.
Adani Ent, Adani Ports zoom
On Monday, Adani Enterprises and Adani Ports recovered some previous losses. Both the stocks are trading near the intraday highs.
At the time of writing, both Adani Enterprises and Adani Ports stock have hit 10% upper circuit at ₹3,038.35 apiece and ₹658.45 apiece on BSE.
The Accusation:
Hindenburg’s research report dated January 24, said, “we reveal the findings of our 2-year investigation, presenting evidence that the ₹17.8 trillion ($218 billion) Indian conglomerate Adani Group has engaged in a brazen stock manipulation and accounting fraud scheme over the course of decades.”
However, Adani’s top management had denied Hindenburg’s accusations, calling the research report of the latter a “maliciously mischievous, unresearched report”. The management has also called Hindenburg’s report with the principal objective of damaging Adani’s ₹20,000 crore FPO, which is one of the biggest follow-on public offers in India. Also, Adani has given detailed clarity over the accusations by Hindenburg.
Why Adani’s FPO saw dull demand in start?
The lackluster demand came after a US-based firm Hindenburg Research accused Adani of stock manipulation and fraud schemes. This led to overwrought selling in Adani stocks on Friday which also dragged the broader market.
Last week, on Friday, the majority of Adani Group stocks hit their lower circuits, which meant that there existed multiple sellers but no buyers. Adani Transmission, Adani Green Energy, and Adani Total Gas closed at 20% lower circuits each on January 27th. While Adani Power and Adani Wilmar also took a beating to get locked at 5% lower circuits each. Further, Adani Ports also struggled and tumbled by over 16% at the end of the day.
Meanwhile, Adani’s flagship company, Adani Enterprises, which launched its FPO on Friday, plummeted by at least 20% before closing at ₹2,762.15 apiece on the BSE.
FPO’s Day 1!
On the first day of the issue, Adani Enterprises recorded bidding of merely 4,70,160 equity shares on a cumulative basis against the offered size of 4,55,06,791 equity shares, as per BSE data.
Download
the App to get 14 days of unlimited access to Mint Premium absolutely free!
[ad_2]
Source link