Billionaire Gautam Adani extolled growth prospects for India and his business empire, slamming a damaging short seller attack against his embattled conglomerate earlier this year.
(Bloomberg) — Billionaire Gautam Adani extolled growth prospects for India and his business empire, slamming a damaging short seller attack against his embattled conglomerate earlier this year.
Adani came out swinging in a speech to shareholders at the annual general meeting of flagship firm Adani Enterprises Ltd. on Tuesday. He hit back at Hindenburg Research’s “malicious” allegations of corporate fraud and stock manipulation, which he labeled as “false narratives” that “various vested interests tried to exploit.”
The tycoon rattled off expansion targets across his ports, energy and infrastructure businesses, while sending a clear message to shareholders: ignore the criticism. Following US-based Hindenburg’s January broadside — which at one point wiped out more than $150 billion of the group’s market value — Adani has scrambled to restore investor confidence.
Read more: Adani’s Go-To Bankers at Barclays Turn Cautious After Hindenburg
Since the attack, Adani’s stocks and bonds have recouped some losses, particularly after the group received investment from GQG Partners, and an interim report from an Indian Supreme Court-appointed panel in May said it found no evidence of stock-price manipulation. Adani Enterprises, which incubates the tycoon’s businesses, in the quarter through March reported that its profit doubled to 7.22 billion rupees ($88 million).
All but two out of the 10 of companies related to Adani Group traded higher after the speech, which largely focused on growth ambitions. The gains are led by Adani Green Energy Ltd., which rose as much as 5.7%. Adani Enterprises advanced 4.2%, while Adani Transmission Ltd. gained 4.7%.
Expansion Plans
The conglomerate will continue to consolidate its existing range of businesses, while looking to branch out into new industries, Adani said. A new airport in Mumbai will be operational by December 2024, while in 12 to 24 months two ports, which have faced protests and delays on environmental and political grounds, will be commission in southern India’s Vizhinjam, as well as Sri Lanka.
Read more: Asia’s Richest Man Challenges China in Show of Support for Modi
Adani also flagged the construction of a major 20 gigawatt green energy project in India’s Khavda desert. A data center joint venture is also on course to build out 350 megawatts of capacity in the short term — and 1 gigawatt in the medium term, he said.
His conglomerate has been refocusing on core businesses and sought to improve its debt metrics after heightened scrutiny over elevated leverage since last year.
“They have realigned the capex, cutting back on roads and delayed some projects so that the debt leverage can be better managed,” said Vinit Bolinjkar, head of research at Mumbai-based Ventura Securities. “The hallmark of the group is to execute projects and build profitable businesses.”
‘Stable Government’
The billionaire more widely talked up India’s potential, forecasting that it will become the world’s second-biggest economy by 2050.
Adani, whose perceived close relationship with Prime Minister Narendra Modi has been highlighted and attacked by opposition politicians since Hindenburg’s report, added that “for any economy to implement policy and lay the foundation of growth, a stable government is critical.”
Adani has tied his business ambitions to Modi’s economic aims. Both are from Gujarat and seen as allies, though Adani Group has said it doesn’t receive or expect special treatment from the government. Modi has been premier for almost a decade and is the favorite to triumph in national elections next year.
“My belief in the growth story of our matrubhumi has never been stronger,” Adani said, meaning motherland. “Our country is the most exciting land of opportunity.”
–With assistance from Adrian Kennedy, Shruti Srivastava, Divya Patil, Ashutosh Joshi and Rajesh Kumar Singh.
(Updates with analyst commentary.)
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