by BENGALURU, Feb 1 (Reuters) – India’s Gautam Adani lost his title as Asia’s richest person on Wednesday as his conglomerate’s stock rout deepened to $74 billion after a sell-off report at discovered.
A Hindenburg Research report last week alleged misuse of offshore tax havens while flagging concerns over high debt and valuations at seven Adani-listed companies.
It has prompted scrutiny of the conglomerate, with an Australian regulator saying on Wednesday it would review the allegations to see if further investigations were warranted.
Adani Group has denied the allegations, calling them baseless and saying it has always made necessary regulatory disclosures.
Wednesday’s stock losses saw Gautam Adani slip to 10th on Forbes’ rich list with around $84.1 billion, just below rival Mukesh Ambani, chairman of Reliance Industries Ltd (RELI.NS) which has an estimate of $84.4 billion. Prior to the Hindenburg Report, Adani had placed 3rd.
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The deepening rout comes despite the group successfully rallying investor support to haul a share sale for flagship Adani Enterprises Ltd (ADEL.NS) on the line on Tuesday.
“There was a slight rebound yesterday after the stock sell-off, after having seemed unlikely at one point, but now the weak market sentiment has become visible again after the explosive Hindenburg report,” said Ambareesh Baliga, an analyst at independent market based in Mumbai.
“With stocks falling despite Adani’s rebuttal, this clearly shows damage to investor sentiment. It will take some time to stabilize,” Baliga added.
Adani Enterprises (ADEL.NS) fell 5% on Wednesday to bring its losses since the Hindenburg report to more than $8 billion. Adani Power (ADAN.NS) fell 5%, while Adani Total Gas (ADAG.NS) fell 10%, down from its daily price limit.
Adani Total Gas, a joint venture between French energy giant Total (TTEF.PA) and the Adani Group, was the biggest victim of the short sellers report, losing an estimated $27 billion.
The data also showed foreign investors have sold $1.5 billion net of Indian stocks since the Hindenburg report – the biggest outflow on four consecutive days since September 30.
Hindenburg said in his report that he had shorted US bonds and non-Indian derivatives of the Adani Group.
Reporting by Chris Thomas in Bengaluru; Additional reporting by Bharath Rajeshwaran and Aditya Kalra; Editing by Edwina Gibbs
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