Indian tycoon Gautam Adani siphons $2.5bn worth of stock from flagship companies

  • Indian tycoon Gautam Adani completed a $2.5 billion share sale for Adani Enterprises on Wednesday.
  • Shares of Adani Group companies have lost $92 billion in market cap since fraud allegations were made by a US short seller.
  • Adani himself has lost almost $50 billion in net worth to the stock market crisis so far this year.

Indian business tycoon Gautam Adani made a $2.5 billion share sale on Wednesday after shares of its flagship Adani Enterprises suffered massive losses following a short seller attack.

The amazing turnaround came even as Adani Enterprises’ offering was fully subscribed on Tuesday thanks to institutional investors, Bloomberg reported. However, demand from private investors was low.

“Today the market was unprecedented and our stock price fluctuated throughout the day. Given these exceptional circumstances, the company’s board of directors believed it would be morally unfair to proceed with the offering,” Adani, the chairman of Adani Enterprises, said in a statement on Wednesday.

Listed companies in the Adani Group have lost $92 billion in market capitalization since Hindenburg Research, a US short seller, published a scathing report last Tuesday alleging “brazen stock manipulation and accounting fraud” at the Adani Group. Shares of Adani Enterprises, the conglomerate’s flagship, fell 28% in one day on Wednesday and are down 43.5% in market value this year.

The Adani group has vigorously defended themselves, but Hindenburg has also doubled down on his original report.

The fallout has shaken the market. The Securities and Exchange Board of India, the country’s markets regulator, is investigating the massive sell-off as well as any irregularities in the secondary stock sale, Reuters reported on Wednesday, citing a source with direct knowledge of the matter.

Adani himself has lost nearly $50 billion in net worth to the stock market crisis so far this year, costing him the crown as Asia’s richest person, according to the Bloomberg Billionaires Index.

Adani is now worth about $72 billion, falling behind Indian billionaire Mukesh Ambani. The latter, chairman of the conglomerate Reliance Industries, is now the richest Asian in the world with a fortune of $81 billion.

The Securities and Exchange Board of India and Adani Group did not immediately respond to insiders’ requests for comment.

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