The US-based forensic short-seller Hindenburg Research may have found its new victim in Block, a company run by former Twitter CEO Jack Dorsey. The Adani group, its old victim, seems to be making a recovery. Friday marks the two months of Hindenburg's explosive report on the ports-to-power major. Since then, a number of Adani group shares have gone up to 73 per cent, but stock prices are on the mend, according to the data.
The January 24 report by Hindenburg, its biggest in terms of significance, described accounting frauds, money laundering and stock manipulation at Adani group companies. Adani Group shares, such as Adani Total Gas, Adani Enterprises, Adani Green Energy and Adani Transmission, took severe beatings, but were soon reconstructed, as the Adani group denied all allegations.
The market capitalisation of Adani group recovered from a sub-Rs 7 lakh crore on February 27 to Rs 9,89, 736 crore as on Friday's intraday levels, but it still is down 48.44 per cent from January 24 closing of Rs 19,19,888 lakh crore.
Adani Total Gas lost 73 per cent of its market value. Adani company commanded Rs 1,13, 549.89 crore m-cap on Friday against Rs 4,27, 326 crore on January 24. Adani Transmission is down 59 per cent. Flagship Adani Enterprises'Adani Enterprises' shares are down 47 per cent, while those of Adani Green Energy are down 46 per cent. Adani Power down 28 per cent, NDTV down 29 per cent and Adani Wilmar down 27 per cent have lost more than one-fourth of their market value. Ambuja Cements and ACC have seen 25 per cent erosion in their market value, while Adani Ports has been the least affected stock with 14 per cent drop.
Hindenburg Research has built a reputation over the last couple of years. In June 2019, a short-seller said that NYSE-listed Eros International auditor Grant Thornton did not apply basic scrutiny to the company's financials, and said that 30 companies that Hindenburg wanted to target since 2020 on average lost 15 per cent the next day and 26 per cent on average six months later.
Many of the group stocks fell below the 1,00, 000 crore m-cap mark as a result of the selloff in Adani shares. At one point, only one Adani stock commanded a m-cap of over Rs 1 lakh crore against six as on January 24. Today, except Adani Power, rest 5 stocks namely Adani Total Gas.
Adani Enterprises, Adani Transmission, Adani Green Energy and Adani Ports command mcaps of over 1 lakh crore.