Adani shares fall again in India after US allegations against founder

MUMBAI, November 22, 2024 (BSS/AFP) – Shares in Indian billionaire Gautam Adani’s conglomerate fell again on Friday after US allegations that the tycoon paid more than $250 million in bribes to secure lucrative government contracts damaged confidence. investors.

The bombshell indictment on Wednesday in New York accused Adani and several of his subordinates of deliberately misleading international investors as part of a bribery scheme.

Adani, who was once the world’s second richest man, is a close ally of Indian Prime Minister Narendra Modi and critics have long accused him of unduly benefiting from their relationship.

Shares of Adani Enterprises, the main listed unit of his conglomerate, fell more than four percent in morning trade, with similar losses in listed ports and energy subsidiaries.

The frantic selling on Thursday led to multiple trading halts and Adani Enterprises has lost more than a quarter of its market capitalization since the indictment was made public.

The Adani Group on Thursday strongly rejected the allegations against its directors, calling them “baseless” and saying it would pursue “all possible legal remedies”.

Indian opposition leader Rahul Gandhi called for Adani’s arrest after the indictment was announced, but said his relationship with Modi would shield him from scrutiny.

“We demand that Adani be arrested immediately. But we know that will not happen because Modi is protecting him,” Gandhi told reporters in New Delhi.

An indictment unsealed Wednesday accuses Adani and several of his subordinates of paying bribes to Indian officials for solar power contracts that are projected to generate more than $2 billion in after-tax profits.

None of the defendants named in the case are in custody.

The Modi government has yet to comment on the charges, but ruling Bharatiya Janata Party (BJP) spokesman Amit Malviya said the indictment appeared to implicate opposition parties and not his own.

With a business empire spanning coal, airports, cement and media, the Adani Group has weathered previous allegations of corporate fraud and suffered a similar stock crash last year.

The conglomerate lost $150 billion in market value in 2023 after a report from short-selling firm Hindenburg Research accused it of “brazen” corporate fraud.

It alleged that the Adani Group had been involved in “stock manipulation and accounting fraud” for decades.

The report also said the government’s “leniency towards the group” had left investors, journalists, citizens and politicians reluctant to challenge its behavior.

Denying Hindenburg’s allegations, Adani called his report a “deliberate attempt” to damage its image in favor of short sellers.