Adani Bonds and Stocks Drop on Reports of US Government Extending Probe
On March 18, the stocks of the ten Adani group firms saw a decrease in value after a report by Bloomberg indicating that the US government has expanded its probe into the conglomerate due to allegations of bribery.
The unit Adani Ports & Special Economic Zone Ltd. declined 2.4 cents, or the highest since August, to 79.1 cents on a note due in 2041. A different Adani Renewable Energy RJ Ltd. subsidiary bond due in 2039 had the largest decline since February 2023, dropping 2.3 cents to 83 cents. According to Bloomberg, this reduces the recent gains that drove the securities to their best points since 2022.
The largest loss on Dalal Street at lunchtime was Adani Total Gas, with shares trading 4% down. The stocks of ACC, Adani Green, Adani Transmission, Adani Ports, Ambuja Cements, and Adani Enterprises were down two to three percent.
The equities had fallen as much as 8% earlier in the morning before partially recovering their losses.
The US government was investigating the behaviour of Adani’s founder and chairman, Gautam Adani, and if Adani businesses or affiliates of the firm were engaged in paying Indian authorities for preferential treatment on energy projects, according to a March 15 Bloomberg article.
The investigation was being handled by the Department of Justice’s fraud branch and the US Attorney’s Office for the Eastern District of New York. Adani said that it was not aware of any inquiry pertaining to the company or its founder.
One year has passed since Adani was accused of fraud and market manipulation by short-seller Hindenburg Research, according to the Bloomberg story. The Securities and Exchange Board of India also approved the conglomerate, which had refuted the accusations.
The Adani Group’s shares fell sharply in the previous year after accusations of accounting fraud and stock price manipulation by short seller Hindenburg Research. After vehemently disputing the accusations, the group’s shares have recently increased in value.
Even though the Hindenburg report was released more than a year ago, the majority of the conglomerate’s shares have not yet recovered from the assault of the short sellers.
