Adani stocks regain half of losses from Hindenburg report fallout

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Indian tycoon Gautam Adani’s listed businesses have regained $46bn in market capitalisation over the past month, representing nearly half the losses incurred after Hindenburg Research released a damaging short-seller report almost a year ago.

The sprawling infrastructure conglomerate has been rebuilding its stock market value after the report in January last year accused Adani of accounting fraud and stock market manipulation.

The allegations plunged the group into a public relations crisis, forced it to call off a $2.4bn share sale and wiped as much as $150bn from its market capitalisation despite Adani’s strong denials.

India’s political opposition also seized on the report to attack Prime Minister Narendra Modi, widely perceived to be close to Adani. The billionaire denies benefiting from any personal connection with Modi but says the group aligns itself with the Indian government’s development priorities.

Following a brief recovery rally in March, the market capitalisation of Adani’s 10 listed companies has languished at about Rs10tn ($120bn) for most of the year, roughly half their value prior to Hindenburg’s report.

But since November 24, the stocks have posted average gains of 36 per cent, delivering a recovery of Rs3.8tn in market value and paring overall losses for 2023 to about 25 per cent.

Most of the gains came after a decision on November 24 by the Securities and Exchange Board of India not to request more time for its probe into Adani businesses from India’s Supreme Court, with one official telling justices the regulator had finished investigating all but two of two dozen cases related to the group.

An Asia-based equities analyst at one large European asset manager said the regulator’s decision was “not quite a clean bill of health, but Sebi at least declined to say anything was off after looking into the…