Shares of all 10 Adani Group companies were under stress on Thursday, in sync with the broader market, amid reports that the accounting regulator National Financial Reporting Authority (NFRA) was scrutinising one of the group's auditors. Among group stocks, Adani Green Energy, Adani Power, and Adani Total Gas were top laggards, falling up to 7%. The cumulative market capitalisation of all 10 listed entities of Adani Group slipped to ₹9.55 lakh crore.
The group’s flagship company Adani Enterprises extended its losing streak for the ninth straight session, falling as much as 4% in intraday today. The stock has fallen 13.5% in the last nine sessions.
Adani Total Gas shares touched two-year low in intraday amid sustained selling for the last six consecutive sessions. The stock dropped over 5% today, while it lost more than 12% in the past six trading days.
Meanwhile, Adani Green Energy tumbled 7% during the trade so far, extending losses for the sixth straight session. While Adani Power plummeted 7.4% intraday, Adani Energy Solutions and Adani Wilmar slipped 4% and 5.3%, respectively.
Among others, Adani Ports & SEZ, NDTV, ACC, and Ambuja Cements were down in the range of 1-4%.
The sell-off in Adani Group stocks was triggered amid a report the NFRA had initiated an inquiry into one of EY's member firms in India, SR Batliboi. The auditor, which serves as the statutory auditor for five listed Adani companies, was asked to present audit files of companies controlled by Adani dating back to 2014, as per Bloomberg report. Currently, SR Batliboi is the auditor of Adani Power, Adani Green Energy, Adani Wilmar, and the two newly acquired cement firms, ACC and Ambuja Cements, which contribute to half of the group’s revenues.
Responding to the report, Adani Group spokesperson says, “We strongly reject any suggestion that Adani Group and its businesses have not acted as per the regulations and accounting standards of the jurisdictions in which we operate.”
“The Adani Group has always conducted its business in compliance with all applicable laws and regulations and is confident about its practices, governance and disclosures,” the spokesperson adds.
The Adani Group had been under scrutiny since the beginning of the current calendar year following an adverse report by the U.S.-based short-seller Hindenburg Research, which raised questions about accounting and audits of the conglomerate. Following the Hindenburg report, the capital market regulator SEBI initiated an investigation into the group under the guidance of the Supreme Court.
In August this year, Deloitte Haskins & Sells LLP resigned as the statutory auditor of Adani Ports and Special Economic Zone (APSEZ) following differences with the management over insufficient disclosures over certain transactions. The Adani Group company, however, clarified that “an independent examination at this stage will not be appropriate given the ongoing investigations by market regulator SEBI and the expert committee appointed by the Supreme Court.
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