Adani group stocks fell further on Friday, November 22, extending losses after the previous day's carnage following bribery charges against Gautam Adani filed in a US court by federal prosecutors.
Adani Enterprises stock fell 4 percent to Rs 2,095 on NSE in the opening trade; Adani Green Energy fell 9 percent to Rs 1,040; Adani Energy Solutions fell 4.5 percent to Rs 665; Adani Port and SEZ fell 3 percent to Rs 1,084.
Previously, on November 21, Adani Group’s listed firms suffered a combined market capitalisation loss of Rs 2.2 lakh crore, marking one of the steepest single-day declines in the group’s history. Shares of flagship Adani Enterprises plunged 23 percent to close at Rs 2,184, after hitting an intraday low of Rs 2,155.
Adani Green Energy stock dropped 20 percent during the day, settling marginally higher at Rs 1,146, while Adani Energy Solutions remained locked at the lower circuit of Rs 697.25, reflecting a full 20 percent drop. Adani Ports, Adani Total Gas, and Ambuja Cements also suffered sharp losses, contributing to the erosion in market value.
Also read | US bribery charges: Gautam Adani Group stocks, banks, other shares hit in widespread fallout
The sell-off was triggered by criminal and civil cases filed by the US Department of Justice (DOJ) and Securities and Exchange Commission (SEC) against Gautam Adani, Sagar Adani, and Vneet S Jaain. The allegations centre around a $250 million bribery scheme to secure solar energy contracts in India and include accusations of obstructing justice through evidence tampering and misleading federal authorities. These developments have once again brought Adani group’s governance practices under scanner.
The impact of the allegations has not been limited to Indian equities. Dollar-denominated bonds issued by Adani companies saw record declines. Notes issued by Adani Green Energy in March fell 15 cents, while bonds from Adani Electricity Mumbai due in February 2030 dropped 8.6 cents on the dollar, reported Bloomberg yesterday. Credit rating agency Moody’s called the bribery charges “credit negative,” raising concerns about the group’s governance and its ability to access capital to meet liquidity requirements.
The controversy has also dealt a blow to Gautam Adani’s personal wealth. Bloomberg data shows his fortune declined by $12 billion in a single day on November 21. His net worth has now fallen over 40 percent, from $122 billion in June to $73 billion, making him the most affected among India’s top billionaires in recent months.
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The fresh setback comes as the Adani Group is in the midst of measures to strengthen its financial position. In the recent past, the group has prepaid Rs 7,374 crore in share-backed loans and has raised $1.5 billion through various fundraising efforts.
But the current crisis threatens Adani’s group’s access to funding, particularly in the US. For sure, Adani Green Energy cancelled a $600 million dollar bond issue in light of the allegations. Nirmalya Kumar, a professor at the Singapore University, said yesterday that Adani Group will now find it difficult to raise debt funding in the US.
Separately, Kenyan President William Ruto said on November 21 that he had ordered the cancellation of the procurement process to expand the country's main airport, in which the government was considering a proposal by the Adani Group. Ruto was quoted by news agency Reuters as saying that he had also directed the cancellation of a more than $700 million deal the energy ministry had signed with a unit of the Adani Group to construct power transmission lines.
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