Adani Enterprises follow-on public offer (FPO) witnessed muted response from investors amid on going tussle between Adani Group and US-based short seller Hindenburg. The issue was subscribed only 3 per cent at the end of the second day of three day shares sale via FPO which will end on Tuesday, data from stock exchanges showed.
Adani Enterprises shares traded below the FPO price range of Rs 3,112-3,276 per share for second session. The stock closed at Rs 2,878.50 on Monday making the FPO unattractive for investors, analysts said.
Portion reserved for non-institutional investors was subscribed 4 per cent, portion set aside for retail individual investors was subscribed 4 per cent, pie set aside for employees was subscribed 13 per cent while large investors like banks, foreign institutional investors (FIIs) and mutual funds did not place any bids for Adani Enterprises shares in the FPO, according to data on BSE.
Adani Enterprises is witnessing subdued demand for shares in the FPO after report by Hindenburg alleged that Adani Group had "engaged in a brazen stock manipulation and accounting fraud scheme over the course of decades."
The report came couple of days ahead of the Rs 20,000 crore follow-on share sale of Adani Enterprises opened for investors. All the listed stocks of the group took a beating after the report.
Hindenburg has dismissed charge that its report on Adani Group's malfeasance was a "calculated attack" on India, saying a "fraud" cannot be obfuscated by nationalism or a bloated response that ignored key allegations.
Adani group's listed companies have lost over $70 billion since the January 24 report of the New York firm that flagged high debt levels at the ports-to-energy conglomerate and the alleged use of offshore entities in tax havens. The Indian group has denied all charges and threatened to sue the US firm.
Hindenburg responded to a 413-page detailed statement issued by the Adani Group late on Sunday, saying it failed to specifically answer 62 of its 88 questions, and conflated the company's "meteoric rise" and the wealth of Asia's richest man "with the success of India itself".
Meanwhile, Abu Dhabi-based diversified conglomerate International Holding Co (IHC) will invest $400 million into the FPO of Adani Enterprises, according to media reports.
IHC will make the investment through its subsidiary Green Transmission Investment Holding RSC Limited, The Economic Times reported citing a company statement.
