US short seller’s aim was to profit from a deliberate drive-down of stock prices: Gautam Adani

• The short seller’s report aimed to generate profits through a deliberate drive-down of our stock prices, said Gautam Adani.
  
• Various vested interests tried to opportunistically exploit the claims made by the short seller, he said in an annual report of Adani Enterprises.
  
• These entities engaged and encouraged false narratives across various news and social media platforms, he added.
  

In its latest annual report, Adani Enterprises chairman Gautam Adani has said that a US-based short seller’s report was a deliberate attempt to damage the company’s reputation and gain from the drive-down in stock prices. A report by Hindenburg Research in January had alleged that the group was engaging in stock manipulation and accounting fraud.

“The report was a combination of targeted misinformation and outdated, discredited allegations aimed at damaging our reputation and generating profits through a deliberate drive-down of our stock prices,” said Adani, addressing the short-selling incident.

Hindenburg had also said in its report that it had taken short positions in the group’s stocks.

While all the Adani group stocks lost over half of their value subsequent to the report release, Adani Enterprises suffered the most. The company also backtracked on its plans to raise ₹20,000 crore via a follow-on public offer after its stock price crashed.

Adani said that the group had to confront various adverse consequences due to the report.

“Even though we promptly issued a comprehensive rebuttal, various vested interests tried to opportunistically exploit the claims made by the short seller. These entities engaged and encouraged false narratives across various news and social media platforms,” he said in the report.

Many public interest litigations (PILs) were filed in the Supreme Court over the issue, and the court formed an expert committee to investigate. A report by the six-member committee said it has not found evidence of the Adani group violating existing market regulations. The Securities and Exchange Board of India (SEBI), which was also tasked to look into the issue, sought more time for the same.

“The Expert Committee did not find any regulatory failure. The Committee’s Report not only observed that the mitigating measures undertaken by your company helped rebuild confidence but also cited that there were credible charges of concerted destabilisation of the Indian markets,” said Adani.

He added that the committee did not find any instance of regulatory breach failure. While the markets regulator SEBI is expected to submit its report in August this year, he was confident of a clean chit there too.

“While the SEBI is still to submit its report in the months ahead, we remain confident of our governance and disclosure standards,” Adani said.