Adani Group evaluating remedial and punitive action against Hindenburg Research

All the chaos started on January 24, 2023, when Hindenburg Research group published an investigation which stated that Adani Group, led by Gautam Adani has used offshore entities in offshore tax havens such as Mauritius and Caribbean Islands.It also stated that Adani companies had “substantial debt” which has put the entire group on a “ precarious financial footing”.`

According to Hindenburg, it took two years to compile this investigation. According to CNN business at the end of the report research firm has left 88 questions for the Adani Group which include asking for details on Adani’s offshore entities as to why it has ‘such a convoluted, interlinked corporate structure.’

In a statement to Indian Exchange, the Adani Group claimed that this report had an adverse effect on the company, and shares in seven listed group companies of Adani lost $10.73 billion in market capitalization in India on Wednesday.

Hindenburg also said that it has taken a short position in companies in the Adani Group “through US-traded bonds and non-Indian-traded derivative instruments.” Shorts sellers aim to make money by betting that the stock price of companies they target will fall. This information in the report resulted in the fall of Adani’s US bonds.

Just a few hours after this report was published, Adani Group’s chief financial officer Jugeshinder Singh said that the Hindenburg research firm did not “make any attempt to contact us or verify the factual matrix.” He also said that the allegations made by the firm are “stale, baseless, and discredited.”

In a statement, Adani Group said it is “evaluating the relevant provisions under US and Indian laws for remedial and punitive action against Hindenburg Research .” The company also stated that this report had a really bad impact on the group, it’s shareholders and investors.

Adani Group considered the allegations made by the Hindenburg research firm a baseless and malicious combination of selective information. In a statement to Indian exchanges, Adani Group head of legal, Jatin Jalundhwala called the report by the research group “maliciously mischievous, unresearched.”

 

 




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