Adani Group: Short Seller Hindenburg will benefit from a slide in Adani shares

On Thursday, Adani Group said that the Hindenburg Research report, which claimed that the conglomerate had engaged in accounting fraud and stock manipulation for decades, had a negative impact on its shareholders and investors. Jatin Jalundhwala, Group Head - Legal, Adani, stated in a statement that the report's impact on the volatility of the Indian stock markets is quite concerning. Additionally, it claimed that Hindenburg, a short-seller, would profit from a decline in Adani stock.

Hindenburg will benefit from slide in Adani shares

Adani Group also stated that it was thinking about suing Hindenburg over its negative article.

Volatility in the Indian stock market is major worry and has caused Indian citizens much distress

Further Adani Group stated,

“The maliciously mischievous, unresearched report published by Hindenburg Research on 24 Jan 2023 has adversely affected the Adani Group, our shareholders and investors. The volatility in Indian stock markets created by the report is of great concern and has led to unwanted anguish for Indian citizens.”

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Hindenburg states it holds short positions in Adani Companies through US traded bonds

It further stated that Hindenburg disseminated unfounded materials that were intended to impact a “deleterious effect on the share values of Adani Group companies as Hindenburg Research, by their own admission, is positioned to benefit from a slide in Adani shares”. Hindenburg also claimed in its damning report that it had short positions in the Adani companies through US-traded bonds, non-Indian derivatives, and other non-Indian reference securities.

As a trading strategy, short selling is borrowing shares of a stock and selling them in the hope that the price will fall. The investor can then repurchase the shares at the lower price, give them back to the lender, and pocket the profit. Compared to conventional "long" stock purchases, this trading approach is more risky.

Adani Group: Hindenburg report is deliberate and careless effort by a foreign entity to deceive the investing community and common man

Identifying the report as an “intentional and reckless attempt by a foreign entity to mislead the investor community and the general public”, Adani Group expressed its profound dismay about the Hindenburg report. It further claimed that Hindenburg intended to damage the Adani Group's standing and leaders' reputation in order to thwart the forthcoming follow-on public offering (FPO).

It also stated, “We are evaluating the relevant provisions under US and Indian laws for remedial and punitive action against Hindenburg Research,”

Hindenburg report a malicious attempt to damage the upcoming FPO

Adani Group said that the Hindenburg report was an intentional effort to harm the impending FPO in a previous response to the study. "The investor community has always reposed faith in the Adani Group on the basis of detailed analysis and reports prepared by financial experts and leading national and international credit rating agencies. Our informed and knowledgeable investors are not influenced by one-sided, motivated and unsubstantiated reports with vested interests,”

Hindenburg report: “Adani engaged in "blatant accounting fraud, stock manipulation, and money laundering."

According to the Hindenburg report, which was made public on Wednesday, there was “brazen accounting fraud, stock manipulation and money laundering at Adani, taking place over the course of decades,” which, according to the claim, took place thanks to facilitators in the government and the cottage business of foreign corporations. According to Hindenburg, the study was published after a two-year investigation, the examination of countless papers, and several interviews with former executives.

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