Gautam Adani, the billionaire Indian tycoon, has seen his wealth drop after allegations of illegal practices, accounting fraud, stock manipulation, and money laundering were made against him and his conglomerate. Hindenburg Research, a New York-based short-seller, bet against the Adani equities and published a report detailing its claims.
The Adani Group rejected the allegations and threatened legal action. Meanwhile, shares in Adani companies experienced a stock-market rout, resulting in a loss of $51 billion in market capitalization over two trading sessions. Hindenburg stood by its report and invited legal action. As a result, Adani’s wealth was expected to drop below $100 billion.
Gautam Adani, the Indian billionaire and founder of the Adani conglomerate, has recently found himself at the center of a storm of controversy. Adani, who is currently the fourth richest person in the world with a net worth of $113 billion as of January 26th, 2023, has been accused by the New York investment firm Hindenburg Research of accounting fraud, stock manipulation, and money laundering.
This has resulted in a drop in the prices of Adani group equities, with the Adani empire losing a total of $51 billion in market capitalization over the past two trading sessions.
The accusations made by Hindenburg Research stem from evidence of shell entities controlled by the Adani family, based in tax havens like the Caribbean, Mauritius, and the United Arab Emirates. According to the short-seller, these entities were used to generate forged import/export documentation and launder money from the listed companies.
The Adani Group has vehemently denied these allegations and threatened to take legal action against Hindenburg Research.Hindenburg Research has stood by its report and has even welcomed any legal action taken against it. The short-seller has also challenged Adani to file a lawsuit in the United States, where Hindenburg operates, and stated that it has a “long list of documents” it would demand in a legal discovery process.
The impact of Hindenburg Research report
The fallout from these allegations has resulted in widespread sales of shares in Adani-related entities, with large trading volumes. Companies like Adani Enterprises, Adani Green Energy, Adani Total Gas, Adani Power, Adani Port, and Adani Transmission have seen significant drops in their share prices.
This has also had a negative impact on Adani’s personal wealth, which is expected to drop below $100 billion by January 27th, 2023, to around $93 billion.The accusations made by Hindenburg Research have caused a great deal of turmoil in the Adani empire, leading to a significant drop in the prices of Adani group equities and a decrease in Gautam Adani’s personal wealth.
The Adani Group has denied these allegations and has threatened to take legal action against Hindenburg Research, but the short-seller has stood by its report and has even welcomed any legal action taken against it.