BENGALURU, Feb. 1 (Reuters) – India’s Gautam Adani lost his title of Asia’s richest person on Wednesday as a loss in his conglomerate’s shares deepened to $74 billion following a short-seller report.
A report from Hindenburg Research last week alleged misuse of offshore tax havens and signaled concerns about high debt and the valuations of seven publicly traded Adani companies.
It has been scrutinizing the conglomerate with an Australian regulator saying on Wednesday it would review the allegations to see if further investigation is warranted.
The Adani Group has denied the allegations, calling them baseless and saying it has always made appropriate disclosures.
Wednesday’s stock losses dropped Gautam Adani to 10th place on Forbes’ rich list with an estimated $84.1 billion, just below rival Mukesh Ambani, the chairman of Reliance Industries Ltd (RELI.NS) who is estimated to have $84.4 billion. billion has. Before the Hindenburg Report, Adani was ranked third.
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The worsening defeat comes despite the group having managed to garner investor support to secure a share sale for flagship company Adani Enterprises Ltd (ADEL.NS) on Tuesday.
“Yesterday there was a slight uptick after the share sale went through, after it seemed unlikely at one point, but now the weak market sentiment has resurfaced after the jam-packed Hindenburg report,” said Ambareesh Baliga, a Mumbai-based independent market analyst.
“With stocks falling despite Adani’s rebuttal, this clearly shows some damage to investor sentiment. It will take time to stabilize,” added Baliga.
Adani Enterprises (ADEL.NS) lost 5% on Wednesday to take its losses since the Hindenburg report to more than $8 billion. Adani Power (ADAN.NS) fell 5%, while Adani Total Gas (ADAG.NS) fell 10%, breaking through its daily price cap.
Adani Total Gas, a joint venture between French energy giant Total (TTEF.PA) and Adani Group, is the biggest victim of the short seller report, losing about $27 billion.
Data also showed that foreign investors have sold a net $1.5 billion worth of Indian stocks since the Hindenburg report – the largest outflow in four consecutive days since Sept. 30.
Hindenburg said in his report that it had shorted US bonds and non-India traded derivatives of the Adani Group.
Reporting by Chris Thomas in Bengaluru; Additional reporting by Bharath Rajeshwaran and Aditya Kalra; Edited by Edwina Gibbs
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