Sell-off in India's Adani deepens to $50 billion

[PradoTLC]

Sell-off in India's Adani deepens to $50 billion​

2 days ago

Hindenburg Research slams Indian conglomerate Adani, alleging fraud and manipulation​

indians and fraud...

 

[nahtanbob]

The skills are entrepreneurship and risk taking.

BTW both Gates and Zuck were drop outs too.

It is amazing those skills show up only in sectors or areas where there is little competition or dependence on state contracts

By this logic you will always have the same companies operating airports all the time. How is that any better? At the time of bidding you are supposed to demonstrate ability to execute infrastructure projects of a certain value, not necessarily airports.

In 2006 India did not have any capability to build or run large, efficient airports. We had to contend with Soviet style AAI ones. At that time it was felt necessary to have at least one partner in the consortium with 26% stake who was a previous airport operator. Hence GMR had Fraport and GVK had ACSA. These partners brought in the required technical score for the bid. They were allowed to exit after a certain number of years once the operations had stabilised, which they did.

Fast forward 10 years, we had no requirement for foreign expertise. We were experts at developing airports. Last I knew GMR developed airports in Phillippines, Turkey, Greece, Maldives among others.

Please understand that when an airport is taken over, most of the staff comes along with it. Only the stubborn babu types are dealt with strictly. Even that was the case in the initial era of PPP projects. Now all the airports have new blood and do not require disciplining. So when Adani acquired the airport from GVK, it acquired all the staff as well, who have deep experience of running an airport.

Anyway, I have mentioned in my earlier post that giving 8 airports to one entity is not good. GOI should have diversified. Companies with too much rapid exposure to new projects are at risk. I hope Adani sees the projects through otherwise we will have an endless saga of cost escalations, underhand deals and banks and retail investors left holding the lemon. There is too much stress in society already, we don't need to worry about our banks struggling.

keep in mind in USA airports are managed by cities. Most cities have a vested interest in having a good airport

 

[Paitoo]

keep in mind in USA airports are managed by cities. Most cities have a vested interest in having a good airport

That is also a good model. But then the city administrations in US have a sense of accountability. I shudder when I think of the disgustingly corrupt and monumentally incompetent civic corporations in India. Can never in my wildest fantasies think of giving over control to a BMC or BBMP, reporting to the half asleep, unbathed, criminal MLAs and MLCs. No, PPP is the way for us.

 

[surmabhopali]

LOL. This is a Non issue that will blow over a week.

This was a Hit Job that was released just before Adani launched its 2.5 Billion $ FPO to fund its "Green Hydrogen Project".

Hindenburg Research specialize in doing Hit Jobs for the US & its Oil Mafia. Hindenburg is best known for its critical reports on the electric vehicle space.

1. It had previous targeted electric truck maker Nikola Corp.
2. Another of its Victims was Electric Vehicle maker Lordstown Motors Corp.
3 Another victim was geothermal power plants company Ormat Technologies
4. Another victim was electric car company Mullen Technologies
5. Another victim was China based Crypto mining company , SOS that powers more than 90% of its mining operations with renewable energy sources.

Another of its Target was Tether cryptocurrency that challenged traditional Banking and USD dominance in the US. Unlike traditional crypto coins, Tethere stable coins made it impossible for hackers to steal crypto coins from anyone.

Now for the Record,

Adani Ports & SEZ and Adani Transmission are audited by Deloitte Haskins & Sells.

Adani Power and Adani Green Energy by SRBC & Co. (Ernst & Young)

Adani Airports subsidiary, MIAL (Mumbai International Airport) is audited by Grant Thornton, while the other six airports are audited as per Airport Authority of India panel provisions in the concession agreement by the audit firm, Gayendra & Co.

So their claim of Adani group being audited by some unknown small firm falls FLAT.


Adani will continue to grow as the Public becomes more aware of such Hit Jobs and companies who do them under the guise of "public good"

i can agree with you .

 

[STREANH]

Many Indian members have no idea about the real problem. The main issue is not debt but the allegations of fraud.

Manipulation of the stock price by shell companies and pledging these stocks to get big loans from banks. This is the main point which if true is fraud.

Lots of Indian banks are now holding these fraudulently inflated stocks as collateral for billions of debt.

If this does not worry you, then either you are piss poor or all your assets are in the form of land and gold.

 

[Pranaayam]

Many Indian members have no idea about the real problem. The main issue is not debt but the allegations of fraud.

Manipulation of the stock price by shell companies and pledging these stocks to get big loans from banks. This is the main point which if true is fraud.

Lots of Indian banks are now holding these fraudulently inflated stocks as collateral for billions of debt.

If this does not worry you, then either you are piss poor or all your assets are in the form of land and gold.

Lol. Why are you getting your knickers in the twist? It is for those of us who invested to worry. You just take a chill pill and move on. We have enough sense to manage our own money.

 

[STREANH]

Lol. Why are you getting your knickers in the twist? It is for those of us who invested to worry. You just take a chill pill and move on. We have enough sense to manage our own money.

Luckily I've sold Adani when I heard of the rumours long ago and made good money. But the problem is my main bank is SBI who have provided loans to this guy and also I have a few LIC policies. So I'm also heavily invested in this.

 

[kaykay]

Market works in mysterious ways. His shares are overvalued and needed to come down. Once his shares are at right market values, things will start moving again.

 

[Pranaayam]

Luckily I've sold Adani when I heard of the rumours long ago and made good money. But the problem is my main bank is SBI who have provided loans to this guy and also I have a few LIC policies. So I'm also heavily invested in this.

I mean SBI has come out and said that their exposure is very limited. As for LIC, they invested 30000 crores and their shares was worth 77000 crores. After the fall it is still worth more than 50000 crores. They have better money managers than internet trolls. So don't take unnecessary load on your brain. Take a chill pill.

Adani Enterprises stock is up today and tomorrow is budget. I am sure it will go further up tomorrow. Shorting it now is suicide.

The total purchase value of equity, purchased over the last many years, under all the Adani group companies is Rs 30,127 crore and the market value for the same as at close of market hours on January 27th, 2023 was Rs 56,142 crore.

 

[surmabhopali]

Many Indian members have no idea about the real problem. The main issue is not debt but the allegations of fraud.

Manipulation of the stock price by shell companies and pledging these stocks to get big loans from banks. This is the main point which if true is fraud.

Lots of Indian banks are now holding these fraudulently inflated stocks as collateral for billions of debt.

If this does not worry you, then either you are piss poor or all your assets are in the form of land and gold.

Most Indians save in gold , real estate and fixed deposit in govt funds .

 

[Paitoo]

Adani Enterprises stock is up today and tomorrow is budget. I am sure it will go further up tomorrow. Shorting it now is suicide.

I think the damage / correction has happened. Banks are not displaying any panic as of now. Adani has indulged in share price manipulation, but end of the day it is not a ponzi scheme. It has established businesses and revenue generating assets. My only concern is too many projects going on together so the cash flows will remain strained because of debt servicing. It doesn't help that most airport projects were awarded more or less at the same time and will be in the same stage in their cycle. Even when they open, it's not like a new car launch that suddenly many thousands of people buy it and you have a sudden cash inflow. Infra projects don't see growth like that. On the day that a new terminal opens, the traffic will still remain the same as the day before it.

 

[Hecig]

Luckily I've sold Adani when I heard of the rumours long ago and made good money. But the problem is my main bank is SBI who have provided loans to this guy and also I have a few LIC policies. So I'm also heavily invested in this.

LIC has clarified that they have .975% of their AUM in Adani related holdings and that too (even after the stock going down) is ~86% above its purchase price.

SBI says Adani exposure well below RBI limit​

The exposure of State Bank of India (SBI) to the Adani Group is well below the central bank's Large Exposure Framework, and is secured by cash-generating assets equipped with adequate escrow mechanisms that guarantee on-time debt servicing, a top executive at the country's biggest lender said


Meanwhile at the Stock Exchange,

Sensex rises 445 pts from day's low to end flat; Adani FPO fully subscribed​

Adani FPO fully subscribed
On the final day, Adani Enterprises' follow-on-public offer (FPO) was fully subscribed, led by non-institutional investors (3.2x), qualified institutional buyers (1.2x), and retail investors (0.1x).


That is 2.5 Billion $ raised despite the "hindenburg report".

That is the difference between the Credibility of "Hindenburg" and Adani.

 

[Pranaayam]

I think the damage / correction has happened. Banks are not displaying any panic as of now. Adani has indulged in share price manipulation, but end of the day it is not a ponzi scheme. It has established businesses and revenue generating assets. My only concern is too many projects going on together so the cash flows will remain strained because of debt servicing. It doesn't help that most airport projects were awarded more or less at the same time and will be in the same stage in their cycle. Even when they open, it's not like a new car launch that suddenly many thousands of people buy it and you have a sudden cash inflow. Infra projects don't see growth like that. On the day that a new terminal opens, the traffic will still remain the same as the day before it.

You see it is for Adani to worry about his business and for real investors to decide whether he can manage so many projects or not. It is not ponzi scheme simply because there is no coercion. It is not like he is forcing you to buy the stock. Take a informed decision. I see no problems for his business till BJP is there (for good or bad). I will put my money where my mouth is in this case.

If you believe it to be a scam, then don't invest.

LIC has clarified that they have .975% of their AUM in Adani related holdings and that too (even after the stock going down) is ~86% above its purchase price.

SBI says Adani exposure well below RBI limit​

The exposure of State Bank of India (SBI) to the Adani Group is well below the central bank's Large Exposure Framework, and is secured by cash-generating assets equipped with adequate escrow mechanisms that guarantee on-time debt servicing, a top executive at the country's biggest lender said


Meanwhile at the Stock Exchange,

Sensex rises 445 pts from day's low to end flat; Adani FPO fully subscribed​

Adani FPO fully subscribed
On the final day, Adani Enterprises' follow-on-public offer (FPO) was fully subscribed, led by non-institutional investors (3.2x), qualified institutional buyers (1.2x), and retail investors (0.1x).


That is 2.5 Billion $ raised despite the "hindenburg report".

That is the difference between the Credibility of "Hindenburg" and Adani.

In all of this, it is the retail investors who were made fool.

 

[Hecig]

By this logic you will always have the same companies operating airports all the time. How is that any better? At the time of bidding you are supposed to demonstrate ability to execute infrastructure projects of a certain value, not necessarily airports.

In 2006 India did not have any capability to build or run large, efficient airports. We had to contend with Soviet style AAI ones. At that time it was felt necessary to have at least one partner in the consortium with 26% stake who was a previous airport operator. Hence GMR had Fraport and GVK had ACSA. These partners brought in the required technical score for the bid. They were allowed to exit after a certain number of years once the operations had stabilised, which they did.

Fast forward 10 years, we had no requirement for foreign expertise. We were experts at developing airports. Last I knew GMR developed airports in Phillippines, Turkey, Greece, Maldives among others.

Please understand that when an airport is taken over, most of the staff comes along with it. Only the stubborn babu types are dealt with strictly. Even that was the case in the initial era of PPP projects. Now all the airports have new blood and do not require disciplining. So when Adani acquired the airport from GVK, it acquired all the staff as well, who have deep experience of running an airport.

Anyway, I have mentioned in my earlier post that giving 8 airports to one entity is not good. GOI should have diversified. Companies with too much rapid exposure to new projects are at risk. I hope Adani sees the projects through otherwise we will have an endless saga of cost escalations, underhand deals and banks and retail investors left holding the lemon. There is too much stress in society already, we don't need to worry about our banks struggling.

Airports Authority of India (AAI) manages a total of 137 Airports, which includes 103 Domestic Airports, 24 International Airports, and 10 Customs Airports.

Adani operate 8.

Now put aside your prejudice and tell me RATIONALLY, Where do you see the actual RISK ?

In all of this, it is the retail investors who were made fool.

High valuation of Adani stocks was already a warning for Retail investors.

Something like this was expected and bound to happen. Better soon than late.

 

[kaykay]

You see it is for Adani to worry about his business and for real investors to decide whether he can manage so many projects or not. It is not ponzi scheme simply because there is no coercion. It is not like he is forcing you to buy the stock. Take a informed decision. I see no problems for his business till BJP is there (for good or bad). I will put my money where my mouth is in this case.

If you believe it to be a scam, then don't invest.


In all of this, it is the retail investors who were made fool.

Thats why market can be brutal to short term retail investors who go blindly without stop loss et al. Adani market cap has grown from 100 billion USD in 2021 to 280 billion USD in 2022...long term investers have made massive money. Some corrections were expected as you can't expect a company to grow forever.