India’s Adani group’s market losses hit $100 billion

Adani group losses
Image: BBC

New Delhi: India’s Adani group shares plunged on Thursday after the Gautam Adani-led conglomerate shelved a $2.5 billion share sale amid a turbulent market, bringing its cumulative market capitalization losses to $100 billion since last week’s short-seller attack.

The withdrawal of Adani Enterprises’ share sale marks a dramatic setback for Adani, the school dropout-turned-billionaire whose fortunes rose rapidly in recent years in line with the stock values of his businesses.

Adani on Wednesday called off the share sale as a stocks rout sparked by US short-seller Hindenburg’s criticisms deepened, despite the offer being fully subscribed on Tuesday. In the fallout of the short-sellers’ attack, Adani has also lost his title as Asia’s richest man.

The group’s flagship firm – Adani Enterprises – plunged 10% after opening higher on Thursday. Other group companies – Adani Ports and Special Economic Zone, Adani Total Gas, Adani Green Energy, and Adani Transmission – fell 10% each, while Adani Power and Adani Wilmar dropped 5% each.

The stocks tumble and shelving of the share sale mark an embarrassing turn of events for the billionaire who has forged partnerships with foreign players in his global expansion of businesses that stretch from ports to mining to cement.

Adani is now the world’s 16th richest, as per Forbes’ list, down from third rank last week.

India’s central bank has asked local banks for details of their exposure to the Adani group of companies. CLSA estimates that Indian banks were exposed to about 40% of the $24.53 billion of Adani group’s debt in the fiscal year to March 2022.

With additional input from Reuters.