Two Adani group companies, including the Indian conglomerate’s flagship firm, revealed plans to raise $2.57 billion from the market months after a short-seller report shattered investor trust and lowered share prices.
Adani Transmission (ADAI.NS) said its board approved a public market offering of up to 85 billion rupees ($1.0 billion). Adani Enterprise (ADEL.NS) filed with markets that its board has approved plans to raise 125 billion Indian rupees ($1.53 billion) using similar methods.
After Hindenburg Group accused Indian billionaire Gautam Adani of stock market manipulation and tax haven use, he called off a record $2.5 billion share sale in January. So equity fundraising is his first true test of investor enthusiasm.
Hindenburg Group’s January report shook investor confidence.
Following a Supreme Court mandate, India’s market regulator is investigating Hindenburg’s allegations and Adani group’s related-party dealings. Adani denies them.
“The fact that they have announced it implies to me that the funding has been locked up,” said Varun Khandelwal, director at Bullero Capital, a proprietary trading firm in New Delhi. “This shows strength and reduces pledges.”
Adani Transmission and Adani Enterprise stated in separate statements they would offer equity shares through qualified institutional placements or other permissible methods to obtain finance.
On Friday, Adani Green Energy Ltd. (ADNA.NS) moved its board meeting to May 24.
U.S. investment firm GQG Partners invested $1.87 billion in Adani Enterprise, Ports, Transmission, and Green Energy via secondary market purchases in March.
Adani Group shares have increased in recent months, but they remain considerably below their pre-Hindenburg highs.
Adani Enterprise’s coal trading branch helped treble its January-March profit to $88 million.
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