Adani group marketcap falls by ₹22,735 crore on Thursday

• Seven out of nine Adani group stocks declined on Thursday.
  
• The cumulative marketcap of the nine Adani group companies declined by ₹22,735 crore.
  
• The group’s current marketcap has fallen to ₹8.32 lakh crore, down from ₹21.94 lakh crore on January 24.
  

The rout in Adani group stocks continued on Thursday, with seven out of nine group stocks declining during the day. Four stocks hit their respective lower circuits, with the cumulative market capitalisation of the group falling by ₹22,735 crore.

Negative market sentiments led to a large decline of ₹60,691 crore in Adani group’s market capitalisation on Wednesday, with the flagship Adani Enterprises alone registering a decline of ₹25,856 crore during the day.

Nifty50 and Sensex witnessed see-saw movements on Thursday, closing the day with a decline of 0.2%.

Market volatility is driven by fears of further rate hikes by the US Fed. This, combined with the inflation shocker in January could also result in the Reserve Bank of India announcing another rate hike even as the industry hopes for a pause.

Last week, the combined market capitalisation of the Adani group fell by ₹1.1 lakh crore. With today’s decline, the cumulative market capitalisation of the nine Adani group companies has fallen to ₹8.36 lakh crore.

This is 38% of what it was on January 24, when the Hindenburg Research report was first published alleging stock manipulation and accounting fraud by the group. Since then, it has declined by ₹13.62 lakh crore.


Source: NSE, as at 3:30 p.m., February 22, 2023

Gautam Adani’s rank slips to 29th in the billionaire list

Gautam Adani’s wealth has also plummeted just as fast as the group’s market capitalisation. According to the Bloomberg Billionaires Index, Adani’s wealth currently stands at $42.7 billion, down from $119 billion on January 24.

This is a decline of $76.3 billion in 29 days since the report was published, with Adani falling from the third richest person to the 29th on the list.

The comeback strategy & its effects

Adani group’s ‘comeback strategy’ which involves repaying loans on or ahead of time does not seem to have had the intended effect.

Earlier on Monday, Adani Ports & SEZ announced that it has repaid a ₹1,500 crore loan, and that it would repay loans amounting to ₹5,000 crore in FY24, and another $500 million bridge loan that is due in March this year.

The group also called off its plan to acquire DB Power for ₹7,017 crore, and also withdrew its ₹20,000 crore follow-on public offer (FPO).

According to a report by Bernstein Research, Adani Green can repay debt worth ₹22,000 crore that will fall due in FY25 by delaying some projects, avoiding bidding for new ones and divesting some assets.

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