Adani Enterprises to consider stock sale months after short-seller turmoil

By Matt Townsend

Less than four months after allegations of fraud by a short seller sent his business empire into crisis, billionaire Gautam Adani is considering tapping into the stock markets in a major test of investor confidence.

Adani Enterprises Ltd, the leading Indian business, said in a statement on Wednesday that it is holding a board meeting on May 13 to consider selling the shares. The company did not disclose how much money it intends to raise or who it is working with on a potential deal.

While the Adani family raised about $1.9 billion to sell shares in the conglomerate to US investment firm GQG Partners in early March, none of the group’s major units have tapped the stock market since Hindenburg Research allegations wiped out more than $100 billion from the conglomerate’s value. Shares have recovered some of their losses since February, though Adani’s is still trading at about half the level of its 2022 peak.

Adani, who became the second richest person in the world just months before the Hindenburg Report, denied the short sellers’ allegations of market manipulation and accounting fraud. The group has been trying to restore market confidence with a series of investor roadshows, early debt repayments and plans to reduce the pace of spending on new projects. Adani Enterprises posted a profit of 26% in the March quarter and said earnings more than doubled.

A successful share sale would go a long way toward bolstering Adani’s recovery from the crisis, though much will depend on the terms of the deal and the investors who are involved. Adani Enterprises was close to finalizing a 200 billion rupee ($2.4 billion) share sale in late January, but withdrew the offer after the Hindenburg report caused shares to crash.