Adani loses over $13bn in wealth rout after FPI debacle

By Angel Broking | Published on 21st June 2021 | 70

Adani loses over $13bn in wealth rout after FPI debacle

On June 14, Monday, the NSDL website showed three FPI accounts related to Adani enterprises on the frozen account list. Entailing its publication in major news portals, Adani Group’s market capitalisation fell by almost $15 billion.

These three Mauritius-based funds together held shares worth around Rs. 43,500 crores in four Adani group companies and are registered at the same address in Port Louis.

These three foreign funds are among the top 12 investors of the Adani Group companies. They have a 6.82% stake in Adani Enterprises, 5.92% in Adani Total Gas, 8.03% in Adani Transportation, 3.58% in Adani Green, and 8.03% in Adani Transmission.

Immediately following this debacle, the Adani group claimed such reports to be “blatantly erroneous” and believe they were released to mislead investors. They referred to an email from the Registrar and Transfer Agent that confirmed that the Demat account in which the FPIs held their shares were not frozen.

Adani Group sent an email to NSDL seeking clarification concerning the status of those 3 FPI accounts, reportedly frozen due to inadequate disclosure of information about beneficial ownership. The conglomerate wired Demat account details of Albula Investment Fund, Cresta Fund, and APMS Investment Fund.

In reply, NSDL’s vice president, Rakesh Mehta, said that those three FPI accounts are still “active”. Following this declaration, shares of the company made a recovery after the company strongly rejected media statements.

Adani’s net worth is down by over $13.2 billion in 4 days

The reports released of late dented the chances of Asia’s second-richest man to close the gap in net worth between him and the Chairman of Reliance Industries, Mukesh Ambani. In what is the worst wealth rout globally, Gautam Adani’s net worth plunged by roughly $13.2 billion in 4 days.

As of June 13, the Indian tycoon had a notional wealth of $77 billion per the Bloomberg Billionaire Index. However, at the time of writing, his net worth has dropped to $63.5 billion. The gap between his and Mukesh Ambani’s notional value presently stands at over $15 billion.

How are Adani Group stocks performing?

Here’s how Adani Group companies’ stocks are performing at the time of writing:

  • Adani Ports and SEZ on 18thJune morning registered a growth of 0.78%
  • Adani Enterprises Limited on 18thJune morning was running at 0.66% deficit and down by Rs.9
  • Adani Power was also down by 4.96% on 18thJune morning
  • Adani Transmission stock price has dropped by over 5% at the time of writing

Bottom line

There appears to be some volatility concerning Adani Group companies. Accordingly, analysts believe that investors should proceed with caution in relation to Adani stock today. Furthermore, existing shareholders must remain patient and not engage in panic-selling.

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