• Shares of Adani Enterprises hit lowest price since March 2022 after Hindenburg report.
• Shares in the group’s other businesses also saw losses of around 10% on Thursday.
• Gautam Adani, 60, no longer Asia’s richest person, has slid down Forbes list.

As the situation surrounding billionaire Gautam Adani’s troubled enterprise grew worse, Indian opposition politicians sought a probe into Adani Group.

Market losses reached $100 billion when a US short seller accused the company of committing “the greatest fraud in corporate history.”

The lower chamber of the Indian Parliament was adjourned on Thursday amid raucous demonstrations, one day after the flagship business of the Adani Group backed out of a $2.5 billion stock sale intended to assist down debt levels, boost confidence, and increase shareholder base.

The opposition Congress party has called on Prime Minister Narendra Modi to address the subject and sought the formation of a Joint Parliamentary Committee or an investigation under the supervision of the Supreme Court.

“Keeping public interest in mind, we want a thorough probe into the Adani issue either by a Joint Parliamentary Committee or a Supreme Court-monitored panel,” opposition leader Mallikarjun Kharge said. “There should also be day-to-day reporting of the investigation on the issue.”

In a report last week, New York-based investment research firm Hindenburg Research accused Adani Group of a “brazen stock manipulation and accounting fraud scheme over the course of decades”. It also raised concerns about high debt and the valuations of seven listed Adani companies.

The aggregate market value of the group companies has decreased by almost half since Hindenburg’s report on January 24. Market capitalization for Adani Enterprises, which is said to as an incubator for Adani’s businesses, has decreased by $24 billion.

Adani Group has denied the allegations, with its finance chief calling the Hindenburg report a “malicious combination of selective misinformation and stale, baseless and discredited allegations that have been tested and rejected by India’s highest courts”.

Meanwhile, Gautam Adani released a video message to investors insisting that the fundamentals of his group are “strong” and that its record on paying back debt was “impeccable”.

The “interest of my investors is paramount and everything is secondary”, he said. “Hence, to insulate the investors from potential losses we have withdrawn” the share sale.

Also Read

Adani Group says Hindenburg fraud claim ‘calculated attack on India’

The stock market value of Adani Group was reduced by more than...

Foreign investors are lowering their exposure because many of them are already tired of what they see as an inflated stock market.

On Thursday, shares of Adani Enterprises fell by about 23 percent, reaching their lowest price since March 2022.

Adani Ports and Special Economic Zone, Adani Total Gas, Adani Green Energy, and Adani Transmission all saw losses of around 10% each, while other group companies also experienced pressure.

“I think there is absolutely no limit as to how bad this can be because confidence has absolutely been shaken, the stock is plummeting like there is no tomorrow,” Naeem Aslam, chief market analyst at Avatrade, told Media.

Adani, 60, is also no longer Asia’s richest person, having slid in the rankings of the world’s wealthiest to 16th, as per Forbes’ list, from third last week.

“Unless Adani is able to regain the confidence of institutional investors, stocks will be in freefall,” said Avinash Gorakshakar, head of research at Mumbai-based Profitmart Securities.

According to Sat Duhra, manager of a $1 billion Asian dividend income fund at Janus Henderson Investors, Adani’s wipeout could become more widespread if it causes a greater shift in sentiment.

Also Read

India’s Adani Group loses $50bn in stocks over fraud claims

Shares in the company's flagship Adani Enterprises fell nearly 20%. The fallout...