Adani Group chairman Gautam Adani addressed the shareholders on Tuesday during the conglomerate’s Annual General Meeting (AGM) and took clear shots at the US-based short-seller Hindenburg Research. Dismissing the allegations of fraud made against the Adani Group, he said that the report was a combination of targeted misinformation and discredited allegations. “This report was a deliberate and malicious attempt aimed at damaging our reputation and generating profits through a short-term drive-down of our stock prices,” Gautam Adani said.
Subsequently, he added, despite a fully subscribed FPO, “we decided to withdraw and return the money to our investors to protect their interests”. “While we promptly issued a comprehensive rebuttal, various vested interests tried to exploit the claims made by the short seller. These entities encouraged and promoted false narratives across various news and social media platforms,” Gautam Adani said.
Hindenburg Research had, in January, released a report alleging accounting fraud and stock price manipulation at Adani Group which had triggered stock market rout and has led to the considerable loss and erased about $145 billion in the conglomerate’s market value at its lowest point. Adani Group has, then, denied all allegations by the short-seller and is currently plotting a comeback strategy that includes raising funds, pre-paying debt to address concerns about its cash flows and borrowings and reinitiating its stalled projects while also spending on new projects by the company.
After the incident, the Supreme Court of India constituted an expert committee to look into the matter, the report of which was made public in May 2023. “The Expert Committee did not find any regulatory failure. The Committee’s Report not only observed that the mitigating measures undertaken by your company helped rebuild confidence but also cited that there were credible charges of targeted destabilization of the Indian markets. It also confirmed the quality of our Group’s disclosures and found no instance of any breach,” Gautam Adani said. While SEBI is yet to submit its report, the conglomerate remains confident of its governance and disclosure standards.
“Our track record speaks for itself, and I am grateful for the support our stakeholders have shown as we went through our challenges. It is worth noting that even during this crisis – not only did we raise several billions from international investors, but also that no credit agency in India or abroad cut any of our ratings,” Gautam Adani said.
Listen to Gautam Adani addressing shareholders here…
Resilient under unfavourable circumstances
Gautam Adani said that over the years one characteristic that differentiated Adani Group from others is its resilience. He said that while the world is continuing to be hit by multiple shocks, be it the climate change, geopolitical challenges, supply chain and energy volatility, or persistent inflation, Adani Group had always remained resilient with ‘clear solutions in sight’. “While economic cycles are getting increasingly hard to forecast, there is little doubt that India – already the world’s 5th largest economy – will become the world’s 3rd largest economy well before 2030 and, thereafter, the world’s 2nd largest economy by 2050,” he said.
He informed the shareholders that Adani Group’s balance sheet, assets, and operating cash flows continue to get stronger and are now healthier than ever before. “The pace at which we have made acquisitions and turned them around is unmatched across the national landscape and has fuelled a significant part of our expansion,” he added.
Adani Group of companies posted its profit at Rs 23,509 crore, up 82 per cent during FY 2022-23. Its total income was at Rs 2,62,499 crore, up 85 per cent. The company’s EBITDA grew by 36 per cent to Rs 57,219 crore. The Group’s accelerating cash flow further improved net debt to run rate EBITDA ratio from 3.2x to 2.8x.