Adani cancels FPO on moral grounds, why has ‘morality’ come calling after hindenburg’s report? And where was ‘morality’ when not only the leadership but also the cos are called out for dubious activities?

Adani Group declared on 1 February that it has called down all the Follow-On Public Offerings (FPO) and will return the money to the investors amidst the ongoing controversy that the group has landed upon- The Hindenberg Report. The Report has alleged Adani Group for utilizing tax havens and raised debt concerns.

Adani group has shared on an exchange filing that the board of directors has decided not to proceed with the FPO in the best interest of the investors, and the equity shares account for 20,000 crores INR.

Gautam Adani has replied that the decisions were taken in light of the plummeting stocks that the company has experienced while trading. He asserted that the investors’ interest is vital; thus, he decided to prevent them from surmounting losses.

But, why has Adani’s conscience awakened after the release of the Hindenburg report? The past month visualized a fall in Adani’s stocks by 10 percent, and subsequently, the company has lost a valuation of 10.6 billion USD in the Market cap.

It indicates that Adani’s group fall in stocks is not new. It has occurred previously, and where was his sense of morality when his stocks underperformed in the previous month? 

The Hindenburg report has raised concerns about the increasing debts and the valuations of seven Adani-listed companies. Adani group has denied the accusations stating that the narrative does not have rigorous evidence and roots for ignorance in law. He has further denied them by stating their balance sheets are extremely healthy with strong cashflows and secure assets. Furthermore, the company has an outstanding record of tracking debts. 

Now, the question lies where was Adani’s morality when his company was probed by the SEBI? Why has his morality arisen after the Hindenburg’s figures were released? Is it because he wants to drive away people’s focus from the substantial issue and shed light on his concerns for the investor’s well-being in trading?

SEBI and the Directorate of Revenue Intelligence have previously probed the Group for alleged non-compliance with the rules and suspicious trading activity related to block deals. 

Hindenburg Research, January 24 published a report that provided evidence that the group was engaged in extensive stock manipulation and accounting fraud schemes over time. The Key listed companies have taken an increasing debt, including pledging shares for the rising stocks in loans forwarding the entire group in an unsettled financial footing.

Five of the seven listed companies have been reported to have current ratios below 1, which indicates a high liquidity pressure. The allegations made by the reports have brought down the richest man in Asia, as his fortune declined by 51.7 billion in the past week.

Amidst the chaos of the Gujarat-based conglomerate, he is instilling the sense that India is related to the Adani Group. Why is Adani equating his company to the people of India?

Adani is trying to gain the favor of Indian investors by instilling a nationalist sense. Adani has talked about the incident calling it a calculated attack on India, its independence, quality of the Indian-based companies. The group has tried to link the conglomerate’s success and meteoric rise in its wealth with the success of the people.

The fraud by the Gujarat-based conglomerate can be just a canary in the coal mine as the research firm believes that India’s economy is the most potent and its growth is being prevented by the Adani Group while looting the nation in a fraudulent manner involving the nation in it.

At the end of the day, fraud is fraud even if it is committed by the richest man in the world. Adani’s response to the report pointed out the issues, the decline in the charges, and irrelevant information that is unnecessary. 

If the Indian government switches sides with the Gujarat-based conglomerate, it will cause dissatisfaction among the Indian citizens. 

The Gujarat-based conglomerate’s allegations are not true. Hindenburg’s intent has never been to conspire against the Modi-led Indian government or Adani and its stocks. The company was created to identify man-made disasters in the name of signs of overvalued companies that may come as a selloff. 

edited and proofread by nikita sharma