Veteran emerging-markets investor Mark Mobius said his firm didn’t participate in Adani Enterprises Ltd.’s stock sale before it was pulled due to concerns about the debt of the Indian tycoon’s firms.
(Bloomberg) — Veteran emerging-markets investor Mark Mobius said his firm didn’t participate in Adani Enterprises Ltd.’s stock sale before it was pulled due to concerns about the debt of the Indian tycoon’s firms.
“We were not interested in Adani companies because they did not meet our investment criteria, particularly as regards to debt,” Mobius said by email in response to Bloomberg’s questions on Thursday. The $2.4 billion share sale, which was first announced on Jan. 18, was abruptly pulled on Wednesday as the fallout from a short-seller report by Hindenburg Research continued to spiral.
Mobius Capital Partners LLP’s emerging markets fund and investment trust, which have $250 million in assets under management, count India as one of the top allocations.
Shares in Gautam Adani’s businesses have lost $108 billion in a week, one of the biggest wipeouts in India’s history, after Hindenburg accused the Adani group of market manipulation and accounting fraud — allegations the conglomerate has repeatedly denied. Dollar bonds issued by entities in the Adani group have also plunged to distressed levels.
The selloff deepened after Bloomberg reported this week that units of Credit Suisse Group AG and Citigroup Inc. have stopped accepting some securities issued by Adani’s companies as collateral for margin loans to wealthy clients.
The flagship Adani Enterprises sank 27% on Thursday, adding to a 28% tumble in the previous session.
READ: Adani Contagion Spreads as Indian Benchmark Nears Correction
Mobius, who spent more than three decades at Franklin Templeton Investments before founding his own firm in 2018, told Bloomberg last week that he plans to put more money into India as the “long-term future of the market is great.”
(Updates fifth paragraph to add Citigroup wealth unit halting margin loans on Adani securities.)
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