Drop in Adani Group shares continues after accusations by American research agency

New Delhi:

Shares of the Adani group remained depressed on Friday, falling as much as 20 percent in morning trading after US-based investment research firm Hindenburg Research made damaging allegations.

Shares of Adani Total Gas plummeted 19.65 percent, Adani Transmission plummeted 19 percent, Adani Green Energy plummeted 15.50 percent, and Adani Enterprises tanked 6.19 percent on the BSE.

Adani Ports and Special Economic Zone also fell 5.31 percent, Adani Wilmar fell 5 percent and Adani Power fell 4.99 percent.

In the broader market, the 30-stock BSE benchmark fell 1,106 points, or 1.84 percent, to trade at 59,098.37 during the afternoon session on the back of major sell-offs in financial, banking, oil and IT stocks.

Led by Tata Motors and Bajaj Auto, the BSE Auto index bucked the trend and was the only sector index to trade in the green in the morning session.

Tata Motors led Sensex stocks, rising 5.14 percent as the automaker returned to the black in the December quarter after two years.

Bajaj Auto rose 6 percent, while the BSE Auto index rose marginally to 29,619.19.

The Adani Group said Thursday it is exploring legal options to take “punitive action” against Hindenburg Research for its “reckless” attempt to sabotage a mega stock sale at the conglomerate’s flagship company — a statement the US activist investor responded by saying it stands by its report alleging “brutal” market manipulation and accounting fraud by the group.

“The maliciously mischievous, unresearched report published by Hindenburg Research on January 24, 2023 has negatively impacted the Adani Group, our shareholders and investors. The volatility in Indian stock markets caused by the report is causing major worry and has led to unwanted fear for Indian citizens,” Jatin Jalundhwala, head of the Adani Group, said in a statement.

The report and its unsubstantiated content were intended to have an adverse effect on the share values ​​of the Adani Group companies, as Hindenburg Research, it says, is positioned to profit from a decline in Adani shares, he said.

“We are deeply concerned by this deliberate and reckless attempt by a foreign entity to mislead the investment community and the general public, undermine the goodwill and reputation of the Adani Group and its leaders, and Enterprises,” he said.

“We are evaluating the relevant provisions under US and Indian laws for corrective and punitive action against Hindenburg Research.” Hindenburg, a US-based investment research firm that specializes in activist short-selling, said Wednesday that the two-year investigation has found Adani Group has engaged in brutal stock manipulation and accounting fraud over decades.