Adani stocks’ market cap falls below ₹10 lakh crore as Hindenburg rout erases half of Group’s value

The flagship firm Adani Enterprises shares witnessed their biggest ever intra-day fall as the stock fell down about 25% after the S&P Dow Jones Indices on Thursday said that it would remove shares of Adani Enterprises from widely used sustainability indices, effective February 7, which would make the shares less appealing to sustainability-minded funds. 

Adani Ports and Special Economic Zone was down 14%, while Adani Transmission and Adani Green Energy slumped 10% each. Adani Total Gas, which is a joint venture (JV) with France’s TotalEnergies SE, fell 5%.

The stock fall intensified as National Stock Exchange (NSE) placed additional surveillance measure (ASM) framework on three Adani group stocks – Adani Enterprises, Adani Ports and Ambuja Cements on Thursday, making them subject to more stringent rules.

Hindenburg Research last week accused the Adani group of “brazen” market manipulation and accounting fraud, claiming that a web of Adani-family controlled offshore shell entities in tax havens were used to facilitate corruption, money laundering and taxpayer theft, which the Group termed as ‘baseless’.

The Group had scrapped off its ₹20,000 crore follow-on public offer (FPO) on Wednesday, a day after it was fully subscribed. Its Chairman Gautam Adani on Thursday had said that it would not be “morally correct” to go ahead with the share sale in the current market condition. “Our balance sheet is healthy and assets, robust. Our EBIDTA levels & cash flows have been very strong & we’ve an impeccable track record of fulfilling our debt obligations. We’ll continue to focus on long term value creation & growth will be managed by internal accruals,” he said.

In the last five trading sessions, Adani Enterprises shares have crashed over 61% whereas those of Adani Ports and Transmission declined 35% and 21% respectively.