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Hindenburg says holds short positions in India’s Adani

BENGALURU, Jan. 25 (Reuters) – Hindenburg Research said on Wednesday it has short positions in Adani Group companies through US-traded bonds and non-Indian-traded derivatives, causing shares of companies in the Indian conglomerate to slide.

The short-seller said that seven listed Adani companies are down 85% fundamentally due to skyrocketing valuations and that “major Adani listed companies have also taken on significant debt,” which has “put the entire group in a precarious financial situation.” “. .

An Adani spokesperson did not immediately respond to Reuters’ request for comment on the report.

The company has repeatedly dismissed debt concerns. Jugeshinder Singh, Chief Financial Officer of Adani, told media on Jan. 21, “No one has raised our concerns about debt. No investor has.”

The group, which is controlled by Gautam Adani, the third richest man in the world, has long been plagued by debt concerns and the Hindenburg report comes as Adani Enterprises (ADEL.NS) plans to sell 2, raise $5 billion in India’s largest subsequent IPO this week.

Shares in Adani Ports And Special Economic Zone (APSE.NS) fell 4.8% on Wednesday to their lowest level since mid-July, while Adani Enterprises, the group’s flagship company, fell 2.5% to a 12-week low .

Shares in Adani Enterprises rose by 125% in 2022, while other group companies, including power and gas units, rose by more than 100%.

The total gross debt of Adani Group in the financial year ended March 31, 2022 increased by 40% to Rs 2.2 trillion. CreditSights, part of the Fitch Group, described the group as “overleveraged” last September and said it had “concerns” about its debt.

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While the report later corrected some calculation errors, CreditSights said it maintained its leverage concerns.

Hindenburg is known for shorting electric truck maker Nikola Corp (NKLA.O) and Twitter, though it later reversed its position on Twitter.

Reporting by Mrinmay Dey, Chris Thomas and Aditya Kalra; Edited by Dhanya Ann Thoppil and Edwina Gibbs

Our Standards: The Thomson Reuters Principles of Trust.

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