Adani stocks extend fall as Hindenburg stands by ‘manipulation’ claim

However, two index-based stocks–Adani Ports and FPO-bound Adani Enterprises– recovered from early morning lows to trade 2-3% lower.

Adani group has slammed the findings as “malicious” and unresearched and has said it is exploring punitive action against the US-based research company. Flagship Adani Enterprises’ FPO anchor portion was fully subscribed on Wednesday after the report became public.

Shares of Adani Total Gas traded down 14.62%, Adani Transmission fell 14.11%, and Adani Green slipped 10.17%. 

The benchmark Nifty and the Sensex shed four-fifths of a percent dragged by lenders like ICICI and Axis Bank which were down 2-3% while SBI was down 1.72%. Bank Nifty futures for February were down 1.54%.

“Banks with exposure to Adani Group have seen a correction attenuating the correction in the market,” said Siddarth Bhamre of Religare Broking. “

Interestingly, foreign brokerage CLSA in a report on Adani debt said, “Indian banking exposure is less than 40% of total group debt. Within this, private banks’ exposure is below 10% of total group debt and most banks (including ICICI/Axis) have indicated that they have largely financed assets with strong cashflows, such as airports/ports.”

PSU banks do have material exposure (30% of group debt) but this debt has not increased in the past three years. “Most of the incremental funding to the group for new businesses and acquisitions has come via overseas sources. To conclude, the ballpark exposure of private banks is 0.3% of FY24 loans and 1.5% of FY24 networth. For PSU banks, the exposure is 0.7% of FY24 loans and 6% of FY24 networth,” it added.