Hindenburg Research report an attack on India and its independent institutions, says Adani Group

In this long exposure image, the logo of the Adani Group is seen on a building in Mumbai on January 27, 2023.
| Photo Credit: Reuters

Ahmedabad-based Adani Group on Sunday night issued a detailed rebuttal to the allegations of “stock manipulation and accounting malpractices” levelled by U.S.- based short seller Hindenburg Research, dismissing all allegations and calling the Hindenburg report as an “attack on India and its independent institutions”.

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In a 413-page rejoinder issued before markets open on Monday, the Adani Group said the report was “baseless” and “driven by an ulterior motive to create a false market” and allow the U.S. firm to make financial gains.

“This is not merely an unwarranted attack on any specific company but a calculated attack on India, the independence, integrity and quality of Indian institutions, and the growth story and ambition of India,” it said.

It further said “Hindenburg Research has conveniently ignored the Indian judiciary and regulatory framework”.

This is the first detailed response of the group led by self-made billionaire Gautam Adani after the U.S. firm in a media statement on January 26 said it would “welcome” the Adani Group’s threat of legal action. The short seller had said that its investigation report was prepared over a period two of years and involved visits to multiple countries, mining of documents and data and talking to executives who had worked with the Indian conglomerate.

Stressing that the group and its various entities are in compliance with the applicable laws, Adani Group added that all of its listed entities have a “robust governance framework”.

It also reiterated in its statement that it would explore legal options. “We will exercise our rights to pursue remedies to safeguard our stakeholders before all appropriate authorities and we reserve our rights to respond further to any of the allegations or contents of the Hindenburg report,” it said.

The report, which triggered a sell-off in the group’s stocks, comes at a time when Adani Enterprises, the group’s flagship firm, has launched a ₹20,000 crore follow-on public offer (FPO).

The group has also rubbished the 88 questions the Hindenburg report contains. “They are simply selective regurgitations of public disclosures or rhetorical innuendos colouring rumours as fact… Hindenburg has not published this report for any altruistic reasons but purely out of selfish motives and in flagrant breach of applicable securities and foreign exchange laws,” the rejoinder stated.

In its report released on January 24 in the U.S., Hindenburg Research raised concerns about the Gujarat-based conglomerate’s “substantial debt” that had put the entire group on a “precarious financial footing”.

It also made allegations about the corporate governance structure, links with offshore entities based in tax heavens like Mauritius and stock manipulation.