Adani Group shares were in freefall on Wednesday, when Union Budget 2023 was released, after global brokerage firm Credit Suisse assigned zero lending value to its bond. The global firm’s scrutiny of Adani Group bonds comes a day after Adani Enterprises’ follow-on public offer sailed through successfully due to the support from non-institutional investors.
As of 3:00 PM on Wednesday, Adani Enterprises crashed 30 per cent, Adani Ports dropped 25 per cent, Ambuja Cements plunged 19 per cent, Adani Total Gas dropped 20 per cent, Adani Wilmar was down 5 per cent, ACC slumped 6.5 per cent and NDTV fell 5 per cent.
Credit Suisse Group stopped accepting bonds of Adani group of companies as collateral for margin loans to its private banking clients, a sign that scrutiny of the Indian tycoon’s finances is growing after allegations of fraud by short seller Hindenburg Research, news agency Bloomberg reported.
Following the Hindenburg report that came out on 24 January, which accused the Adani Group of fraud and market manipulation, there were concerns in the market whether Adani Enterprises will attract investors’ attention in its FPO. However, the share sale went through successfully despite dismal participation across categories of retail investors and employees.
The investigative report prepared by Hindenburg Research last week had immediate impact on the Adani stocks, dragging most of them down for five straight trading sessions. It is estimated that about a third of the Adani Group’s market capitalisation has been wiped out in the 5-day rout.