Adani group shares rally after $113 billion market wipeout By Reuters
Stock Markets 25 minutes ago (Feb 07, 2023 01:31AM ET)
(C) Reuters. An activist of the youth wing of India’s main opposition Congress party holds a placard featuring Gautam Adani, chairman of Adani Group, during a protest against what they say are investments by Life Insurance Corporation (LIC) and State Bank of India (SB
BENGALURU (Reuters) -Adani group shares surged on Tuesday, a day after it moved to prepay some loans, in a relief rally for the Indian conglomerate that lost more than $113 billion in market value in two weeks since a U.S. short-seller’s critical report was published.
The group, led by billionaire Gautam Adani, said on Monday it is pre-paying $1.11 billion of loans on shares ahead of their maturity in 2024 due to recent market volatility. Separately, JPMorgan (NYSE:JPM) said the group companies were still eligible for inclusion in the bank’s bond indexes.
Those two factors were having a positive impact on stocks, said Anita Gandhi, director at Arihant Capital Markets.
“Also aiding the rise is the sharp correction in the group stocks, which have made them attractive,” she said.
Indian bourse National Stock Exchange of India (NSE) revised on Monday the maximum daily permissible limit for price moves for Adani Green Energy Ltd and Adani Transmission Ltd to 5% from 10%, according to data on its website.
The group’s flagship company, Adani Enterprises Ltd, jumped 20% on Tuesday morning, while Adani Ports and Special Economic Zone gained 8.9%.
Shares of Adani Green Energy rose 2.7%, and Adani Transmission and Adani Wilmar added 5% each. Adani Total Gas Ltd, however, fell 5% and Adani Power shed 3%.
Many Adani group companies are reporting quarterly results this week, with Adani Ports and Adani Green set to report later in the day.
Though the stocks were staging a recovery, the cumulative losses of Adani group’s seven listed companies still stand at $105 billion since Hindenburg Research’s report on Jan. 24 that alleged it engaged in stock manipulation and use of tax havens. It also said the group had unsustainable debt.
Adani group has denied the allegations, saying it complies with all laws and has made necessary disclosures over time.
Adani has a total notional value of $7.7 billion in the JPMorgan’s CEMBI and JACI indexes, the bank said in a note on Monday.
Besides CEMBI and JACI, Adani’s dollar bonds remain eligible to be part of JPMorgan’s ESG Global Corporate Index (JESG), an integrated environmental, social, and governance corporate benchmark covering investment grade and high-yield markets.
The Adani crisis spilled over to the streets on Monday, with hundreds of members of India’s main opposition Congress party protesting and pressing for a probe into Hindenburg’s allegations.
Adani group shares rally after $113 billion market wipeout
Terms And Conditions
(C) 2007-2023 Fusion Media Limited. All Rights Reserved.
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.