Adani Group Stocks Fall Amid Bribery Allegations, Lose ₹2.2 Lakh Crore

Adani Group stocks continued to tumble on Friday, November 22, exacerbating the losses seen the previous day following bribery charges filed in a U.S. court against Gautam Adani by federal prosecutors.

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Stock Market Performance

• Adani Enterprises: Fell by 4%, opening at ₹2,095 on NSE.      
• Adani Green Energy: Dropped 9% to ₹1,040.      
• Adani Energy Solutions: Declined by 4.5%, trading at ₹665.      
• Adani Ports and SEZ: Lost 3%, standing at ₹1,084.

On November 21, the group suffered a collective market capitalization loss of ₹2.2 lakh crore, one of its sharpest single-day declines. Adani Enterprises plunged 23%, closing at ₹2,184 after reaching an intraday low of ₹2,155. Adani Green Energy and Adani Energy Solutions also faced steep declines, with shares dropping 20% during the day.

Allegations and Legal Challenges

The losses stem from criminal and civil cases initiated by the U.S. Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) against Gautam Adani, Sagar Adani, and Vneet S. Jaain. The charges allege a $250 million bribery scheme to secure solar energy contracts in India and accusations of obstructing justice by tampering with evidence and misleading authorities. The controversy has renewed scrutiny of Adani Group’s governance practices.

Impact on Bonds and Ratings

Adani companies’ dollar-denominated bonds also saw significant declines. For instance, Adani Green Energy bonds issued in March fell by 15 cents, while Adani Electricity Mumbai bonds maturing in February 2030 dropped 8.6 cents. Moody’s labeled the bribery charges as “credit negative,” expressing concerns over the group’s governance and its ability to meet liquidity requirements.

Wealth Erosion and Global Repercussions

Gautam Adani’s personal wealth declined by $12 billion in a single day, reducing his net worth to $73 billion—a significant drop from $122 billion in June. International developments have also compounded the crisis. For example:

• Kenyan President William Ruto canceled procurement processes for airport expansions and energy projects involving the Adani Group.    
• Adani Green Energy withdrew a $600 million dollar bond issuance.

S&P Downgrade and Investor Confidence

S&P Global Ratings revised its outlook on multiple Adani entities, including Adani Ports, Adani Green Energy, and Adani Electricity Mumbai, to negative. Although the agency affirmed certain ratings, it warned of risks to cash flows, governance practices, and funding access if allegations are substantiated or investor confidence weakens further.

S&P emphasized the group’s vulnerability due to its dependence on equity and debt markets for growth and refinancing. The allegations, coupled with existing scrutiny from earlier controversies like the Hindenburg report, raise fresh concerns about governance and reputation.

Future Implications

The group’s ability to sustain its growth plans and maintain financial stability hinges on resolving the allegations and restoring investor trust. Should the charges be proven, further downgrades and heightened borrowing costs are likely. Additionally, the concentrated ownership structure remains a critical factor in evaluating the governance and overall resilience of the Adani Group.