Adani-Hindenburg saga timeline: The trouble, the fall and the turnaround
Adani groupsays it has made full prepayment of margin-linked share backed financing before the deadline.
- The group's stocks crashed after the
Hindenburg reportbut has recovered in recent times.
- The group says it has since changed capex plans, given up on acquisitions and also raised funds.
The credit update also said that the company’s net debt-to-EBITDA ratio decreased from 3.81 in FY22 to 3.27 in FY23. Its leverage has been a key investor concern ever since US-based research firm Hindenburg came out with a report against the group, alleging stock manipulation and accounting fraud in addition to pointing out that its debt levels were too high.
Here is a timeline of the Adani-Hindenburg saga
The ‘damning report’
On January 24, 2023, Hindenburg Research released its report 'How The World’s 3rd Richest Man Is Pulling The Largest Con In Corporate History'. It alleged that the group has undertaken questionable practices – asking 88 questions on the group’s source of funds, offshore entities and more. It also said it has taken short positions on the group’s stocks.
Stocks of all the nine companies of the group went into a freefall after the report was released — losing as much as ₹1 lakh crore in market value.
FPO & its cancellation
On January 31, the group decided to go ahead with Adani Enterprises’ ₹20,000 crore follow-on public offer (FPO), which was fully subscribed thanks to the many family offices that bought into it. But on February 2, the group cancelled the FPO citing ‘unprecedented situation and the current market volatility’.
In early February, Gautam Adani’s ranking in the global rich list fell from #2 to #21, thanks to the crash in the group’s stocks. Index provider MSCI said it would announce changes in the free-float status in some Adani securities.
Comeback strategy in effect
To allay concerns, the group made a few changes to its ambitious plans in late February – it suspended work on the ₹34,900 crore Mundra petchem project and pulled the plug on its ₹7,017 crore acquisition of DB Power. Adani Green Energy also said it put ₹10,000 crore capex plans under review.
GQG Partners’ investment
In early March, GQG Partners founded by Rajiv Jain pumped ₹15,446 crore into four Adani group companies — Adani Enterprises, Adani Ports & SEZ, Adani Green and Adani Transmission.
PILs in Supreme Court
In March, the Supreme Court combined various public interest litigations (PILs) filed in the Adani-Hindenburg saga into one case, brought in markets regulator SEBI, and appointed a committee to investigate whether there was any regulatory failure in dealing with the alleged contravention of laws pertaining to the securities market in relation to Adani group companies.
Supreme Court extends deadline to SEBI
In May, the SC committee report said it has not found evidence of the Adani group violating existing market regulations. SEBI, however, was given an extension to submit its report.
AdvertisementGQG Partners doubles down on Adani bet
GQG Partners increased its stake in the Adani group by about 10%, taking the total value of its investment in the group to $3.5 billion. Rajiv Jain, GQG’s founder said that within five years, they would like to be one of the largest investors in Adani group.
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