‘Draped in national flag, Adani Group looted India’

A man looks at an electronic signage displaying news on the Adani Group at the BSE building, in Mumbai. Pic/AFP

US short seller Hindenburg Research on Monday rejected Adani Group's charge that its report was an attack on India, saying a "fraud" cannot be obfuscated by nationalism or a bloated response that ignored response to key allegations.

Commenting on the 413-page response Adani Group released late on Sunday evening in response to its report, Hindenburg said it believed India was a vibrant democracy and an emerging superpower with an exciting future and it was Adani Group that was holding it back through "systematic loot".

Even the Twitterati called out the Adani Group for equating the conglomerate to India. Hindenburg stood by its last week's report that said its two-year investigation found Adani Group "engaged in a brazen stock manipulation and accounting fraud scheme over the course of decades".

‘Sensationalistic claim'

Hindenburg said the response by the conglomerate run by Asia's richest man Gautam Adani "opened with the sensationalistic claim that we are the ‘Madoffs of Manhattan'." Adani also claimed we have committed a "flagrant breach of applicable securities and foreign exchange laws."

"Despite Adani's failure to identify any such laws, this is another serious accusation that we categorically deny," it said. Adani Group had claimed the report was driven by "an ulterior motive" to "create a false market" to allow the US firm make financial gains by dragging stock prices down.

Also Read: Adani group stocks witness mixed trends in early trade; Adani Enterprises jumps 10 per cent

‘A nationalist narrative'

Hindenburg responded saying Adani Group "predictably tried to lead the focus away from substantive issues and instead stoked a nationalist narrative." "Adani Group has attempted to conflate its meteoric rise and the wealth of its Chairman, Gautam Adani, with the success of India itself," it said.

"We disagree. To be clear, we believe India is a vibrant democracy and an emerging superpower with an exciting future. We also believe India's future is being held back by Adani Group, which has draped itself in the Indian flag while systematically looting the nation."

Stating that a "fraud is fraud even when it's perpetrated by one of the wealthiest individuals in the world," it said Adani's ‘413-page' response only included about 30 pages focused on issues related to the report.

"The remainder of the response consisted of 330 pages of court records, along with 53 pages of high-level financials, general information and details on irrelevant corporate initiatives, such as how it encourages female entrepreneurship and the production of safe vegetables," it said.

The report by the tiny New York firm, which specialises in short selling, has led to Adani Group losing billions in market value. Adani Group's rebuttal failed to pacify investors, driving stock market losses for the coal-to-ports group to almost $70 billion over three days.

Will seek answers from Adani Group: LIC

Life Insurance Corporation (LIC) on Monday said it will talk to Adani Group's management over the allegations against the conglomerate. "Presently there is a situation that's emerging and we are not sure what is the factual position... Since we are a large investor we have the right to ask relevant questions and we will definitely engage with them," LIC Managing Director Raj Kumar told Reuters.

CFO likens rout to Jallianwala massacre

Adani's finance chief, Jugeshinder Singh, likened the behaviour of Indian investors participating in the sell-off to the colonial-era Jallianwala Bagh massacre in Amritsar city. On April 13, 1919, a British officer ordered about 50 Indian Army soldiers to shoot at unarmed civilians participating in a peaceful protest, killing at least 379 of them. "In Jallianwala Bagh, only one Englishman gave an order, and Indians fired on other Indians. So am I surprised by the behaviour of some fellow Indians? No," Singh told the Mint business daily in an interview published on Monday, when asked why the market believed the Hindenburg report.

Tweet talk

Advaid, Historian@Advaidism
A small reminder to Mr Gautam Adani; Adani is not India and India is not Adani. The Hindenberg report pointed fingers at Adani Group, not India. A great man once said "Patriotism is the Last Refuge of the Scoundrel".

Ali Khan Mahmudabad, Assistant Prof of history, political science@Mahmudabad
The real attack on India is by the Adani group which owes lakhs of crores in debt. The real attack is on shareholders of LIC for eg whose money was liberally invested in Adani. Think about.

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