August 19, 2023 [Oil Price]- Adani Transmission, a subsidiary of Indian conglomerate Adani Group, has denied reports that Abu Dhabi National Energy Co. PJSC (TAQA) will invest $1.5-2.5 billion in Adani Group firms or in a single entity. The Economic Times had earlier reported that TAQA is evaluating a large exposure in the sprawling power businesses of billionaire Gautam Adani that span thermal generation to transmission, clean energy and green hydrogen, said people aware of the matter.
“In this regard, we wish to clarify that the Company is not engaged in any discussion with Abu Dhabi National Energy Co. PJSC (TAQA), for their investment in the Company,” the company said in a stock exchange clarification
The reports had sent shares of Adani Group companies soaring, with Adani Green Energy, Adani Energy Solutions and Adani Power jumping up to 12% in Friday’s trade on BSE. Earlier in the year, the shares were hammered after short-seller Hindenburg Research published a damning report alleging that Adani Group was involved in “brazen stock manipulation” and “an accounting fraud scheme over the course of decades”.
According to Hindenburg, Gautam Adani, founder and chairman of the Adani Group, had managed to amass a net worth of roughly $120 billion, with $100 billion coming in the past 3 years, largely through stock price appreciation in the group’s seven key listed companies, which had spiked an average of 819% over the timeframe. Hindenburg argued that Adani Group’s seven key listed companies “…had 85% downside purely on a fundamental basis owing to sky-high valuations”.
To allay investor concerns, Adani Group sold Rs 15,446 crore (~$1.9B) worth of shares in four of its companies to US-based equity fund GQG Partners. GQG Partners bought 55,600,000 shares of Adani Green Energy; 38,701,168 Adani Enterprises shares, 88,600,000 Adani Ports shares and 28,400,000 shares of Adani Transmission. To enhance its green credentials, Adani canceled a Rs 7,017 crore ($857.6 million) coal plant purchase, ditched plans to buy a stake in power trader PTC India and suspended work on a Rs 34,900 crore ($4.3B) petrochemical project in Gujarat. Adani Group later revealed that it prepaid share-backed financing of Rs 7,374 crore ($901.2 million) to various Indian financial institutions and international banks. The company also held multiple roadshows in London, Dubai, Hong Kong and Singapore, among other locations.
The measures appear to have worked only partially, with Adani Enterprise shares paring back some losses but still down nearly 20% in the year-to-date.
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