Adani Group stocks continued continued to fall on Wednesday after global brokerage firm Credit Suisse said it will stop accepting bonds of the company as collateral for margin loans to its private banking clients.
All Adani group firms ended 2-28 percent lower, eroding around Rs 1.85 lakh crore in market cap, at the close of the market hour on February 1. Since last week, the group lost around Rs 7.44 lakh crore in market value.
The Swiss lender’s private banking arm has assigned a zero lending value for notes sold by Adani Ports and Special Economic Zone, Adani Green Energy and Adani Electricity Mumbai Ltd, a Bloomberg report said.
The private banking arm of Credit Suisse, too, has assigned a zero lending value for notes sold by Adani Ports and Special Economic Zone Ltd, Adani Green Energy and Adani Electricity Mumbai Ltd. It had previously offered a lending value of about 75 percent for the Adani Ports notes, the Bloomberg report said.
With Wednesday’s drop, Adani’s personal wealth gains from last year — all $44 billion of them — have now evaporated in merely a week. He also lost the title of Asia’s richest person to rival billionaire Mukesh Ambani,
according to the Bloomberg Billionaires Index.
Adani Group, which recently faced a selloff spree following a report by Hindenburg Research last week that flagged concerns about the conglomerate's debt levels and the use of tax havens, saw its follow-up public offer being subscribed 1.12 times on the final day. This was despite the group companies losing around $91 billion market cap with many firms seeing lower circuit.
Adani on January 27 added about $300 million worth of shares for a loan made by a group of banks, including Barclays Plc, Bloomberg reported citing a source.
MSCI has put out a consultation paper to decide on how they treat the Adani stocks, which are part of its Global Standard Index amid a freefall in the shares.
“Aware of the reports recently published regarding the Adani Group and associated securities. Will announce to all clients simultaneously if there are any changes to MSCI indices,” it said.
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