Adani issues 413-page response and calls attack on Hindenburg allegations against India

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On Sunday, India’s wealthiest Gautam Adani’s group likened the damning allegations by short seller Hindenburg Research to a “calculated attack” on India, its institutions and its growth story, saying the allegations are “not nothing but a lie”.

In a 413-page response, Adani Group said the report was motivated by “an ulterior motive” to “create a false market” to allow the US company to make financial gains.

“This is not just an unwarranted attack on any particular company, but a calculated attack on India, the independence, integrity and quality of Indian institutions, and the history of India’s growth and ambition,” he said.

Stating that the allegations in Hindenburg Research’s Jan. 24 report are “nothing but a lie”, he said the document is “a malicious combination of selective misinformation and hidden facts about unsubstantiated allegations. and discredited to drive an ulterior motive”.

“This is rife with conflicts of interest and is intended solely to create a false securities market to enable Hindenburg, a recognized short seller, to achieve massive financial gain through illicit means at the expense of countless investors,” did he declare.

He then questioned Hindenburg’s credibility and ethics, and said the bad faith intent underlying the report was evident given the time Adani Enterprises Limited is undertaking one of the largest public offerings in shares in India.

“Hindenburg has not released this report for altruistic reasons, but solely for selfish motives and in flagrant violation of applicable securities and foreign exchange laws,” he said. “The report is neither ‘independent’, nor ‘objective’, nor ‘well-researched’.” Activist short seller Hindenburg Research, the company that captured global attention with the breakup of electric vehicle makers Nikola and Lordstown Motors, alleged in a report on Wednesday that its two-year investigation found the Adani Group “had engaged in brazen inventory manipulation and accounting fraud”. regime over the decades.

The report by the small New York-based short-selling company caused the Adani Group to lose more than $50 billion in market value in just two trading sessions and Adani himself lost more than $20 billion, or about one-fifth of its market value. total wealth.

Hindenburg called the conglomerate’s “substantial debt,” which includes pledging stock for loans; that Vinod, Adani’s brother, “runs a vast maze of fictitious offshore entities” that funnel billions into group companies with no disclosure required; and that its auditor “seems hardly capable of complex audit work”.

Of the 88 issues raised by Hindenburg, 65 of them relate to matters that have been duly disclosed by Adani’s portfolio companies, Adani Group said. “Of the remaining 23 questions, 18 concern public shareholders and third parties (not Adani’s portfolio companies), while the remaining 5 are baseless allegations based on imaginary fact patterns.” He listed the report’s issues and dismissed them as “false suggestions based on malicious misrepresentation of governance practices” or “manipulated narrative around unrelated third-party entities” or “biased and unsubstantiated rhetoric”.

“We reaffirm that we comply with all applicable laws and regulations. We engage at the highest levels of governance to protect the interests of all our stakeholders,” he said. “The Adani portfolio also has very strong internal controls and audit controls. All Adani Portfolio listed companies have a strong governance framework. The aim of the Adani portfolio and Adani’s verticals is to contribute to nation building and bring India to the world, he said.

“We will exercise our recourse rights to protect our stakeholders before all competent authorities and we reserve the right to respond to any allegations or content of the Hindenburg report or to supplement this statement,” he added.

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