Environment
Some of Wall Street’s biggest names are exposed to the Adani Enterprises plunge
Chairperson of Indian conglomerate Adani Group, Gautam Adani, speaks at the World Congress of Accountants in Mumbai on November 19, 2022.
Indranil Mukherjee | AFP | Getty Images
Shares of India’s Adani Enterprises have plummeted over the past week, after the publication of an extensive critical report from U.S. short-seller Hindenburg Research. Some big international players have exposure.
Companies across the Adani Group of companies have seen a huge sell-off that took the total group’s losses past $110 billion by Friday close, after the Hindenburg report accused the conglomerate of “brazen stock manipulation and accounting fraud scheme over the course of decades.”
The ports-to-energy conglomerate, led by one of the world’s richest men, Gautam Adani, has vehemently denied wrongdoing.
Adani Enterprises has suffered the biggest loss among the wider group’s many listed companies, shedding more than 60% of its market cap — or more than $30 billion — between the report’s publication on Jan. 24 and the close of Thursday trade.
The Adani Group firmly denies the accusations, calling them “nothing but a lie” from the “Madoffs of Manhattan” in a 413-page riposte that failed to soothe skittish investor sentiment and rein in a rapid sell-off.
Adani owns 64% of Adani Enterprises — the Adani SB Family holds 55.27%, while 8.73% is with Adani Tradeline Pvt Ltd, where Gautam and brother Rajesh Adani are controlling directors.
Top 20 shareholders in Adani Enterprises
| Institutions / Insiders | Ownership (%) | Shares (thousands) |
|---|---|---|
| ADANI SB FAMILY | 55.3 | 630,034.7 |
| Adani Tradeline Pvt Ltd | 8.7 | 99,491.7 |
| Life Insurance Corporation of India | 4.0 | 45,815.0 |
| Green Enterprises Investment Hldg | 3.5 | 40,191.0 |
| Flourishing Trade & Investment | 3.0 | 33,937.7 |
| Afro Asia Trade & Investments | 2.7 | 30,249.7 |
| Worldwide Emerging Market Hldg | 2.7 | 30,249.7 |
| HSZ (Hong Kong) | 1.7 | 19,295.4 |
| Elara Capital Plc | 1.7 | 19,190.1 |
| M.M. Warburg Bank (Schweiz) | 1.3 | 14,290.9 |
| The Vanguard Group, Inc. | 0.7 | 8,497.0 |
| SBI Funds Management Pvt | 0.6 | 7,195.0 |
| BlackRock Fund Advisors | 0.6 | 6,454.2 |
| Spitze Trade & Investment | 0.3 | 3,986.0 |
| UTI Asset Management | 0.2 | 2,237.5 |
| BlackRock Advisors (UK) | 0.2 | 1,901.3 |
| Kotak Mahindra AM | 0.1 | 1,281.8 |
| Geode Capital Management | 0.1 | 1,114.0 |
| Dimensional Fund Advisors | 0.1 | 831.1 |
| Nippon Life India AM | 0.1 | 737.3 |
Source: FactSet, as of 1030 UTC on 3 Feb
The third-largest shareholder, at 4.02%, is India’s state-owned Life Insurance Corporation of India. Morning sessions in both houses of India’s parliament were adjourned on Friday, as opposition leaders called for an investigation into the allegations against Adani, who is a close associate of Prime Minister Narendra Modi.
Indian Minister of Parliamentary Affairs Pralhad Joshi reportedly told journalists on Friday that the government “has nothing to do with Adani matters.”
The list of top 20 shareholders of Adani Enterprises also includes two of the biggest names on Wall Street: Vanguard owns 0.75% of the stock, while BlackRock Fund Advisors holds 0.57% and BlackRock Advisors (U.K.) Ltd has a 0.17% interest.
Spokespersons for Vanguard and BlackRock did not immediately respond to CNBC requests for comment.
Elara Capital, which currently owns 1.7% of Adani Enterprises, was the largest institutional shareholder until Feb. 2022, ownership data shows.
Hindenburg has accused Elara’s Mauritius-based funds of being part of a plan to manipulate the share prices of companies owned by Adani Group and hide how much the family owned. Elara has since disposed of 72% of the shares it held in the company, according to FactSet data.
Jo Johnson, the brother of former British Prime Minister Boris Johnson, resigned on Wednesday from his role as a director of Elara, according to Companies House.
Elara Capital and Johnson did not immediately respond to CNBC requests for comment.