Feb 20, 2023
By: Katya Naidu
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Days after billionaire George Soros criticized the Indian government for its silence on Hindenburg’s allegations of stock manipulation and accounting fraud against the group, two top business leaders lent their support to the energy-to-infrastructure conglomerate.
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"If somebody thinks today that a call from the prime minister will make bankers give (loan) then they are living in a fool's world. No banker will do this thing," said DLF’s chairman emeritus K P Singh on Sunday. The opposition alleged that the Modi government aided the group’s rise.
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Singh who launched DLF’s IPO which was one the largest in 2007, also added that there are "blackmailers" who bring out reports around any big share sale. Adani Enterprises called off its ₹20,000 crore follow-on public offer after the stock was battered on account of the report.
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Bank of Baroda CEO Sanjiv Chadha told Bloomberg that he is not concerned about the volatility around the Adani group stocks. The group’s nine stocks cumulatively lost ₹12.56 lakh crore after Hindenburg said that it took short positions on the group’s US listed securities.
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Chadha also said that the bank will extend loans to the group if it meets their underwriting standards. “You stick to them in good times as well as bad times,” he told Bloomberg.
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While he did not mention Adani or Hindenburg, chairman of Mahindra group Anand Mahindra also reacted to commentary against India, especially in the international media. Economist wrote an article on February 3 titled, ‘Why Adani Group’s troubles will reverberate across India.’
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“Global media is speculating whether current challenges in the business sector will trip India’s ambitions to be a global economic force. I’ve lived long enough to see us face earthquakes, droughts, recessions, wars, terror attacks. All I will say is: never, ever bet against India,” Anand Mahindra said on February 4.
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Bengaluru-based proxy adviser InGovern was one of the first to react to the Hindenburg report saying it had ‘no new facts’. It also said that the nature of the group’s businesses are such that they operate on debt. Adani has business interests in ports, airports, energy, in addition to ambitious plans for Green Hydrogen.
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“These days, there are many new age companies with no revenue model and with no earnings, Adani stocks may appear to be inexpensive,” InGovern said on Adani group valuations.
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In the aftermath of the report, a GVK group spokesperson denied Congress leader Rahul Gandhi’s allegations that the Mumbai airport has been taken away from them by ‘agencies of the government’. In 2020, the Adani group acquired a majority stake in Mumbai airport from GVK, which built and ran it for over 14 years.
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“GVK reiterates that the decision to sell its stakes in Mumbai Airport to Adani, was taken by the management and there was absolutely no question of any extraneous pressure being exerted on us,” a spokesperson told PTI.
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