Adani Group: India’s second richest industrialist Gautam Adani (Gautam AdaniThe year 2023 has been very difficult for ). In the month of January this year, he was hired by the American short selling company Hindenburg Research (Hindenburg Research) faced serious allegations ranging from money laundering to share manipulation, fraudulent transactions, accounting fraud. The group continued to deny the allegations. Adani broke his silence on the report in his AGM, calling it a calculated attack on India. But, the matter was investigated by SEBI. Due to this, the company had to suffer a loss of crores of rupees. The market value of nine public limited companies of Adani Group reduced by around $ 150 billion. The share price of Adani Enterprises is still 18 percent less in the market. However, now there is a big relief news for the company. The losses of Adani Group companies have reduced to a great extent. According to news agency Reuters, Adani Group’s loss has reduced to only $64 billion as of Friday. Also, even after the research report, Adani Ports shares are giving 36 percent profit and Adani Power shares are giving about 18 percent profit.
EBITDA increased in Adani Group
According to the report, Adani Group made a strong strategy to come out of the crisis. Under this, the group joined hands with big investors like GQG and Abu Dhabi conglomerate International Holding (IHC.AD). This strengthened the shareholding. However, during this period the company also made repayment of the stock backed loan. The company started working on three strong fronts. Thought about rapid growth, leverage and continued improvement in valuations. Now the net profit of the group is around 22 billion dollars. Additionally, EBITDA (proxy for cash flow) has also increased substantially. The consolidated ratio of the company reduced from 3.3 times to 2.5 times. According to the LSEG report, the four largest businesses by market cap are trading at 89 and 202 times earnings. Whereas, before Hindenburg Research this rate was 315 to 845 times. The company got a lot of benefit from the positive comment in favor of the company from the Supreme Court on the investigation of Hindenburg Research. Due to this the company’s shares rocketed in the market.
What did the Supreme Court say
The Supreme Court said that there is no reason to doubt market regulator SEBI, which is investigating the allegations against Adani Group in the Hindenburg report. He said that there is no fact before him to distrust the market regulator’s investigation. Along with this, the top court said that it is considering the claims made in the Hindenburg Report as not being completely based on facts. The bench said that in the absence of any facts before it, it would not be appropriate to constitute a Special Investigation Team (SIT) at its own level. A bench headed by Chief Justice DY Chandrachud reserved its order after hearing the arguments of the parties related to the Adani-Hindenberg case. The court objected to SEBI being asked to investigate the Adani-Hindenburg case on the basis of some media reports. He said that he cannot ask a statutory regulator to accept anything published in the media as absolute truth.
Adani made huge earnings last week
Due to the positive attitude of the Supreme Court towards the company, there was a rise in the stock of Adani Group in the stock market. The group earned around Rs 1 lakh crore last Monday. Last week, BSE Sensex rose by 1,511.15 points or 2.29 percent while Nifty rose by 473.2 points or 2.39 percent. Vinod Nair, Head of Research, Geojit Financial Services, believes that better than estimated GDP figures will give a growth outlook for the financial year 2023-24 and this will encourage the market to maintain the bullish momentum. Apart from this, enthusiasm was also seen from the monthly sales figures of vehicles. India’s gross domestic product (GDP) growth rate in the July-September quarter was a higher than expected 7.6 percent. In this way, India has maintained its status as the fastest growing major economy in the world.