February 5, 2023

Adani Group’s market cap fell by ₹46,000 crore due to the Hindenburg report

Hindenburg Report vs. Adani Group: Gautam Adani-led Adani Group saw its troubles intensify on Wednesday, when shares of its seven companies began to show a steady decline. But the reason behind this made the most headlines!

In fact, a recent report by renowned American research firm Hindenburg Research has rocked the Adani Group. The Hindenburg Report pointed to the Adani Group’s involvement in ‘stock market manipulation’ and ‘accounting fraud’ over decades.

What happened next, as soon as this report came out, shares of all Adani Group companies were seen trading in the red zone.

In fact, Gautam Adani, founder and chairman of the Adani Group, has a staggering net worth of around $120 billion, which has grown by $100 billion over the past three years, according to reports.

The main reason behind this increase is attributed to the amazing growth recorded in the share prices of all the companies under the Adani Group in this report. The most important of these were the 7 companies under the group, which gained an average of 819% during the corresponding period.

According to the report, Adani Group companies are short positions. The report also raised some questions about the loans taken by these companies by accusing them of fraud. Along with this, shares of companies were termed as overvalued by up to 85%.

Hindenburg-Report-vs-Adani-Group

According to the Forensic Financial Research Company, several people, including former senior executives of the Adani Group, were interviewed, thousands of documents were examined and several official websites and statistics from more than a dozen countries were used to prepare the report.

If Hindenburg is to be believed, he has been investigating the Adani Group for the past 2 years. The company has also been accused of taking loans by pledging unreasonably inflated stock.

Apparently soon after this report was published, shares of seven Adani Group companies lost nearly ₹46,000 crore of their total market cap on Wednesday, registering a decline.

Adani Group’s response to the Hindenburg Report

Meanwhile, while reacting to this report, questions were also raised about its credibility and timing by the Adani Group.

The Adani Group said that by presenting the report now, it is clearly an attempt to tarnish the Adani Group’s reputation, which could also damage the upcoming follow-on public offering of Adani Enterprises. India’s largest FPO.

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