Adani market cap sinks Rs 2.2 lakh crore amid bribery charges in the US

The Adani Group witnessed a massive erosion of Rs 2.2 lakh crore in market capitalisation as shares of its major companies took a nosedive following allegations of bribery by US prosecutors.

Stocks of Adani Ports, Adani Enterprises, Adani Total Gas and Ambuja Cements tumbled by as much as 20 per cent, while Adani Power and ACC experienced losses of 14 per cent and 12 per cent respectively. Adani Wilmar and NDTV also declined by 10 per cent each, further deepening the crisis for the conglomerate.

The allegations, stemming from charges filed by the US attorney for the Eastern District of New York, accuse Adani executives — including Gautam Adani’s nephew Sagar R. Adani and Vneet S. Jaain — of orchestrating a scheme to bribe Indian officials to secure lucrative solar energy contracts.

Prosecutors allege the group concealed these activities while raising USD 1.36 billion from American investors between 2020 and 2023, in violation of federal laws.

Adding to the fallout, GQG Partners, a prominent investor in Adani Group stocks, saw its shares plunge by 20 per cent on the Australian Securities Exchange.

Rajiv Jain, the firm’s chairman, assured stakeholders that over 90 per cent of its clients’ investments remain diversified outside the Adani portfolio. However, GQG is closely monitoring its exposure to the conglomerate.

The market rout follows a broader decline in the Adani Group’s valuation, which has shrunk by nearly Rs 7.5 lakh crore from its 52-week high.

Despite the ongoing controversies, the group has made concerted efforts to reduce its debt burden. In March 2023, it prepaid Rs 7,374 crore in share-backed loans and pledged to eliminate such financing entirely by the end of the month.

In 2024, the Adani Group undertook several fundraising initiatives to strengthen its financial position. These include a USD 1 billion qualified institutional placement (QIP) by Adani Energy Solutions in August to reduce debt and invest in infrastructure and a USD 500 million share sale by Adani Enterprises in October to fund energy projects, a PVC manufacturing plant and debt reduction in its airport unit.

Looking ahead, the group had plans to raise an additional USD 1.5 billion through dollar bond issuances under Adani Green Energy and Adani Energy Solutions by early 2025, primarily for debt refinancing.

Now, the allegations in the US have cast a long shadow over the group’s financial health and governance practices — including in India, implicating SEBI and BSE as well for their implicit failure of oversight if some of the charges are found to hold true.

Unsurprisingly, investors are exercising due caution as scrutiny of the conglomerate intensifies, both domestically and internationally.