Shares of Adani Group companies crashed up to 20% in opening trade on Thursday after the chairman Gautam Adani and seven others indicted in the U.S. court in a multibillion-dollar bribery and fraud scheme. Adani has been indicted in a federal court in Brooklyn, New York for allegedly bribing Indian government officials with over $250 million to secure lucrative solar energy contracts worth billions of dollars. Following this development, Adani Group has reportedly canceled its $600 million bond offering, which dragged down its U.S. dollar bonds in Asian trading.
The sentiment was further dented amid report that U.S.-based investment firm GQG Partners, which is a significant investor in Adani group companies, may review its portfolio exposure to the power-to-port conglomerate. The Rajiv Jain-led firm has infused around ₹80,000 crore in Adani Group companies, including Adani Ports, Adani Green Energy, and Adani Enterprises. It was among the first foreign equity firm to invest in the company post-Hindenburg Research’s allegations in January last year.
Triggered by the development, all ten listed Adani group entities opened in red today, with more than half of them hitting their lower circuit limit. The top loser among the group stock was Adani Energy Solutions, which was locked in its lower circuit limit of 20%.
Among others, Adani Green Energy, Adani Power, Adani Total Gas, ACC fell in the range of 15-18%. The Group flagship Adani Enterprises hit its lower circuit limit of 10%, followed by Adani Ports and SEZ, Adani Wilmar, and Ambuja Cement, which were also locked in their 10% circuit limits. The share price of NDTV was also hovering near its 10% lower circuit limit.
The cumulative market capitalisation of the Adani group stocks dropped by ₹1.86 lakh crore to ₹12.42 lakh crore from ₹14.28 lakh crore at the end of trade on Wednesday.
A five-count criminal indictment was unsealed in federal court in Brooklyn charging Gautam Adani, his nephew Sagar Adani and Vneet S. Jaain, managing director and CEO of Adani Green Energy, along with five other individuals for their alleged roles in the bribery scheme and lying about it as they sought to raise capital from U.S. and international investors. Between 2020 and 2024, the defendants agreed to pay more than $250 million in bribes to Indian government officials to obtain lucrative solar energy supply contracts with the Indian government, which were projected to generate more than $2 billion in profits after tax over an approximately 20-year period, say U.S. prosecutors.a
In a separate development, U.S. Securities and Exchange Commission (SEC) charged Gautam Adani and his nephew Sagar Adani for an alleged bribery plot that involved paying or promising to pay the equivalent of hundreds of millions of dollars in bribes to Indian government officials to secure their commitment to purchase energy at above-market rates that would benefit Adani Green and Azure Power. SEC also charged Cyril Cabanes, a former member of Azure Power’s board, with Foreign Corrupt Practices Act (FCPA) violations for his role in the alleged bribery scheme. According to the SEC’s complaint, Cabanes allegedly facilitated the authorisation of bribes in furtherance of the scheme while in the United States and abroad.
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