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Adani Group released 413 pages of rebuttals On Sunday, Hindenburg Research was condemned for last week’s 100-page bearish report. Hindenburg responded overnight, saying that the rebuttal only answered 62 of the 88 questions, avoiding key issues. Adani’s rebuttal was not enough to calm investors as most stocks and bonds linked to the Indian group tumbled in their third session. However, contrary to the bear market, the Abu Dhabi royal family is bullish on Adani.
As Hindenburg accuses Adani Group of “Pulling the biggest scam in company history“, “participated in a brazen scheme of stock manipulation and accounting fraud over a period of decades”, the three-day sell-off has wiped more than $68 billion off the market value of the Adani group of companies.
Billionaire Gautam Adani lost $20 billion of his personal fortune. Before Hindenburg’s bearish report last Wednesday, his ranking on the Bloomberg Billionaires Index fell from No. 4 to No. 7.
“Not sure if Adani’s rebuttal is enough to assuage investors’ concerns. Just because things are revealed and known doesn’t make them correct,” said Smartkarma analyst Brian Freitas.
Freitas added: “How does such a large group explain no analyst coverage and no mutual fund holdings?”
Later Sunday, Hindenburg wrote in an essay statement Adani’s rebuttal fails to answer key questions:
Our report asks the Adani Group 88 specific questions. In its response, Adani did not specifically answer 62 of them. Instead, it primarily groups questions together by category and provides a generalized deflection.
In other cases, Adani simply pointed to its own documents and declared the issue or related matter resolved, again failing to substantively address the issues raised.
As we detail, of the few questions it did answer, its answers largely confirmed our findings.
Hindenburg reported last week ahead of Adani Enterprises’ $2.5 billion follow-on public offering for institutional investors. The shares were trading below the offer price.
“They may need to offer more discounts.
Nitin Chanduka, an analyst at Bloomberg Intelligence, said: “Investors seem to have a hard time justifying buying FPOs, so they may not participate in the offering. Also, onshore mutual funds avoid active exposure to the group, so they may not participate too much.” many.”
Meanwhile, Adani Group Chief Financial Officer Jugeshinder Singh told CNBC TV 18 in an interview that there will be no change in the offer price.
Despite the turmoil, the Abu Dhabi-based international holding company said it would invest 1.4 billion dirhams ($400 million) in a follow-on share sale, about 16 percent of the total offering.
“Our interest in Adani Group stems from our confidence and belief in the fundamentals of Adani Enterprises.
Syed Basar Shueb, CEO of IHC, said: “Over the long term, we see strong growth potential and add value to our shareholders.”
We don’t know if IHC’s investment will be enough to restore confidence in the Adani Group.
via Zerohedge.com
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