Indian tycoon Adani slams ‘malicious’ Hindenburg report

New Delhi – Indian tycoon Gautam Adani on Tuesday denounced fraud accusations against his group by a US investment firm as a “deliberate attempt” to damage its image, at the first annual general meeting since the scandal. 

US short-seller investment company Hindenburg Research accused the Adani Group in January of using offshore tax havens to manipulate stock prices.

Before the allegations Adani was listed by Forbes as Asia’s richest man, but shares in his group firms plummeted in the wake of the report, sending him tumbling down the rankings, with his fortune at one point dropping by more than $100 billion.

The shares have since recovered some of their losses, but the group’s flagship subsidiary Adani Enterprises remains around 30 percent below its price level before the report.

Addressing shareholders at the Adani Enterprises annual general meeting, Adani called the document a “combination of targeted misinformation and discredited allegations”. 

“This report was a deliberate and malicious attempt aimed at damaging our reputation and generating profits through a short-term drive-down of our stock prices,” the media-shy billionaire said. 

He was confident of the group’s governance and disclosure standards after a panel set up by India’s top court found no “regulatory failure”, he added. 

Short-sellers seek to profit by offloading shares in the hope that their prices will fall and they can buy them back cheaper, and Hindenburg’s report accused the conglomerate of artificially inflating its market value using related-party transactions conducted through tax havens. 

Soon after the report, the group abruptly cancelled a stock sale and refunded investors. 

But Adani said Tuesday: “It is worth noting that even during this crisis, not only did we raise several billions from international investors but also that no credit agency in India or abroad cut any of our ratings.” 

The group’s income grew 85 percent in the last financial year, the tycoon added. 

Political opponents accuse Prime Minister Narendra Modi of abetting Adani’s rapid rise, allowing the billionaire to unfairly win contracts and avoid proper regulatory oversight.

Both men come from the western state of Gujarat, and Adani praised the Indian government on Tuesday, without naming Modi.

There was “little doubt” India would become the world’s third-largest economy by 2030, and its second-largest by 2050, he said.

“It is well understood that for any economy to implement policy and lay the foundation of growth, a stable government is critical,” he said.

“We have seen this impact with the implementation of several structural reforms that are critical for strong, sustainable, and balanced growth.”

Opposition lawmakers have demanded a probe into Modi’s links to the tycoon, and public financial institutions’ potential exposure to his firms.

Adani’s statement comes just months after global stock index compiler MSCI dropped two of the conglomerate’s member companies from its India index.