The vertiginous fall of the Indian giant Adani
In five days, the Adani Group lost more than $100 billion of its value.
Here in Ahmedabad, January 27, 2023. AP - Ajit Solanki
Text by: Patricia Lecompte
3 mins
Indian billionaire Gautam Adani was the world's third-richest man, according to
Forbes
magazine , and Asia's wealthiest, until he was accused last week of accounting fraud by US fund Hindenburg Research .
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Born in Ahmedabad, in the state of Gujarat in India, Gautam Adani comes from a modest family.
Self-taught, he abandoned his studies to embark on an active life.
After a brief stint in the diamond industry, in 1988 he founded his export company Adani Group, which over the years grew into a powerful conglomerate.
In 35 years, the Indian businessman built his empire by making a fortune in coal mines, port terminals, logistics, agribusiness, and even airports.
It becomes India's largest port developer and operator.
In 1995, he landed the construction and operation of the commercial port of Mundra, which has since become the country's leading port.
At the same time, the group is diversifying into coal mining in India, but also internationally and is moving into thermal energy, petrochemicals, cement and even copper refining.
Then the group invests in new sectors, such as
data centers
, tech or media.
Considered a close associate of Indian Prime Minister Narendra Modi, Gautam Adani is experiencing a meteoric rise.
At 60, he is at the head of an empire estimated at nearly 240 billion dollars on the stock market and a personal fortune close to 137 billion dollars.
Seen as one of the strong men of Gujarat, a state ruled by Modi from 2001 to 2014, his dazzling success has earned him many challenges.
This is the case for its coal mining project in forests in central India in defiance of indigenous communities, or for its
hostile takeover bid launched in 2022 on the NDTV television channel
, considered the last independent media in India.
Descent into hell
But for five days, the magnate's empire has been wavering.
A small American company, Hindenburg Research, accuses the conglomerate of accounting fraud.
In a report released last week
, the U.S. fund says the Adani Group uses undisclosed related-party transactions and earnings manipulation to "
maintain the appearance of sound financial health and creditworthiness
" of its listed subsidiaries. Sotck exchange.
Incidentally accusing the Indian government
of "leniency towards the group
" for decades.
The conglomerate clarifies that "
this is not just an unwarranted attack on a specific company, but a calculated attack on India, the independence, integrity and quality of Indian institutions and the history of growth and India's ambition
.
In addition, the group affirms that the fundamentals of the company remain “
very solid
” and that its balance sheet is healthy.
These statements were not enough to reassure investors.
Since last week, the Indian tycoon has suffered a descent into hell.
The charges of the American fund caused
the collapse of its titles
on the Bombay Stock Exchange.
In five days, the Adani Group lost more than $100 billion of its value and Gautam Adani saw his personal fortune melt by $44 billion, dropping him from third to fifteenth place in the ranking of the world's largest established fortunes. by
Forbes
.
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