The Adani Group said it’s exploring legal action against US investor Hindenburg Research after the short seller released a report alleging “brazen” market manipulation and accounting fraud by Asia’s richest man’s empire. “We are evaluating the relevant provisions under US and Indian laws for remedial and punitive action against Hindenburg Research,” Jatin Jalundhwala, legal head for the Adani Group said in a statement.
The “maliciously mischievous, unresearched” report has adversely affected the company, shareholders and investors, said Jalundhwala. “The volatility in Indian stock markets created by the report is of great concern and has led to unwanted anguish for Indian citizens,” the statement added.
Bonds and shares of Adani-related entities slumped after Hindenburg’s Jan. 24 report, shaving $12 billion in market value off the tycoon’s empire by the end of trading on Wednesday. A raft of dollar bonds of Adani Group companies fell further Thursday. Indian markets are shut Thursday for a holiday.
The broadside from Hindenburg alleging wide-ranging corporate malfeasance comes at a critical time for Adani. The tycoon is seeking to raise his international profile and is aggressively branching into new businesses, including cement and media, in his power base of India, where he is seen to enjoy a close relationship with Prime Minister Narendra Modi.