How one investor bullish on Adani brought 28% of FPI money in 2023

GQG’s total net investment in India this year, as of 28 December, stood at ₹44,935 crore, of which ₹37,441 crore was pumped into five Adani Group companies, including flagship Adani Enterprises, according to bulk and block deals reported on National Stock Exchange and BSE. The other group companies were Adani Ports and Special Economic Zone (APSEZ), Adani Power, Adani Green and Adani Energy Solutions.

GQG also invested ₹7,494 crore in five non-Adani companies—IDFC First Bank, Patanjali Foods, GMR Airports Infrastructure, JSW Energy and Max Healthcare Institute.

India’s total net FPI investments stood at ₹1.62 trillion in the calendar year through 27 December. GQG Partners alone accounted for nearly 28% of those inflows.

GQG’s investments in the Adani stocks, initially in March, lifted the stocks from the lows they hit after US short-seller Hindenburg Research, in a report released on 24 January, alleged corporate malfeasance against the ports-to-renewable energy group, which rubbished the allegations. Subsequent investments by GQG in June and August further helped boost sentiment in the group’s stocks.

Following the Hindenburg report, the Adani Group’s total market cap of 10 listed stocks shed $125 billion to hit a low of $73.18 billion on 27 February. That value has since rebounded to $155.4 billion currently, thanks in good measure to the investments by Jain’s asset management firm.

Jain’s investments in the five non-Adani firms have shown a 20% increase over the invested amount, according to data from NSE and BSE. The returns on Adani stocks have been even better, with the return on initial investment standing at 76% currently, which proves Jain’s pedigree as an investor, according to market veterans.

“Rajiv Jain of GQG is a well-respected investor with an outstanding track record, including in his previous stint at Vontobel (a Swiss investment firm),” said Nilesh Shah, managing director, Kotak Mahindra Asset Management Co. “He was partly responsible for the re-rating of Indian consumer staples earlier with his aggressive buying. His strong commitment to India this year, accounting for a large part of FPI flows, is likely to be observed by many global investors.”

“I have known Rajiv in the past. He’s of a ‘traditional assets’ bent, not new tech,” said Shankar Sharma, the founder of GQuant Investech.

In an earlier interaction with Mint over e-mail, Jain had justified his investments in the Adani Group at the height of the Hindenburg fallout. “We are very bullish on the group also because it is playing a very important role in infra buildout for India. We want to be strategic partners in helping India build world class infrastructure,” he had said.

The investment firm held stakes in all the 10 firms mentioned above as of the quarter ended September 2023.