Adani bonds and stocks plunge on news of US bribery probe

Several Adani Group dollar bonds experienced their worst fall in over six months. Adani Ports & Special Economic Zone Ltd’s 2041 bond saw the biggest drop, plunging 2.4 cents to 79.1 cents, its steepest decline since August 2023. A bond from Adani Renewable Energy Ltd fell 2.3 cents to 83 cents, its sharpest decline since February 2023.

The selloff extended to the company’s stocks as well. Shares of Adani Enterprises opened nearly 5% lower at ₹3010.4 per share. Other group companies such as Adani Ports, Adani Total Gas, Adani Energy, and Adani Power also saw their stocks drop between 2% and 4.5%. The rout resulted in a ₹48,298 crore drop in the Adani Group’s market capitalisation to ₹15.29 lakh crore.

Kranthi Bathini, director of equity strategy at Wealth Mills Securities Pvt Ltd told Mint, “The negative news surrounding the US investigation has disproportionately impacted Adani Group shares due to their high-beta nature. High-beta stocks tend to experience larger swings than the overall market. In this case, the ongoing market consolidation, in which broader indices are experiencing sideways movement, has amplified the negative reaction to the Adani news.”

Bloomberg reported on Friday that the US government was scrutinising the conduct of the group’s founder and chairman Gautam Adani. The investigation reportedly centers on whether Adani entities or affiliates bribed Indian officials to get preferential treatment for energy projects.

Last year, Adani Group stocks crashed after short-seller Hindenburg Research accused the conglomerate of manipulating its stock price and accounting fraud. The group vigorously denied the allegations and its shares have since recovered.

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Published: 18 Mar 2024, 11:31 AM IST