Adani Group stocks suffered massive downfall on Wednesday after a report claimed that Swiss investment banker Credit Suisse has stopped accepting bonds of Adani Group companies as collateral for margin loans to its private banking clients.
The flagship Adani Enterprises Ltd (AEL) fell the most, losing 28.2 per cent to end at ₹2,135.35 on the NSE. This comes just a day after AEL successfully closed its follow-on public offer (FPO) raising ₹20,000 crore in the price band of ₹3,112-3,276 a share.
A Bloomberg report noted that Credit Suisse’s move is “a sign that scrutiny of billionaire Gautam Adani’s finances is growing after allegations of fraud by short seller Hindenburg Research.” In its report on January 25, Hindenburg Research had alleged Adani Group of stock manipulation and fraud, which was rubbished by Adani terming it discredited allegations and an attack on India.
What has further fuelled the negative sentiment against Adani is the report from Australia’s Sydney Morning Herald citing unidentified sources, which stated that the Australian corporate regulator was reviewing the Hindenburg allegations against Adani Group.
Even as the broader markets remained volatile during the Budget day with Sensex gaining up to 60,773 levels before closing at 59,708, with gains of 0.27 per cent, Nifty ended in red at 17,616.30, down 0.26 per cent, after hitting an intra-day high of 17,972.20.
Four of the 10 Adani portfolio companies had only sellers on the counters on Wednesday. These included Adani Total Gas (-10 per cent), Adani Power (-4.9 per cent), Adani Wilmar (-5 per cent), NDTV (- 5 per cent). The Ports arm, Adani Ports and Special Economic Zone (APSEZ), was down 19 per cent to close at ₹495.15. The stock was traded with heavy volumes of 4.65 crore shares.
Cement makers Ambuja Cements and ACC lost 16.72 per cent and 6.19 per cent respectively to end at ₹334.10 and ₹1,846.45 respectively on the NSE. Adani Green Energy and Adani Transmission lost 5.6 per cent and 2.85 per cent, respectively, to end at ₹1,155.35 and ₹1,723.50 respectively.
In the Forbes list of richest persons, Adani lost from third spot last week to 14th after Wednesday’s stock rout with his personal networth tumbling to $77 billion, down $11 billion in a day.