Early on Thursday, November 21, the dollar bond prices of Adani Group companies fell sharply in early Asian trade after Gautam Adani, the billionaire chairman of the group, was indicted in New York on bribery and fraud allegations.
The Adani Group has faced significant financial and reputational challenges following reports of a US investigation into bribery and fraud allegations against its chairman, Gautam Adani, and associates. The probe, led by the US Department of Justice and the Attorney’s Office for the Eastern District of New York, is reportedly scrutinizing whether Adani-linked entities engaged in illicit practices to secure favorable deals for energy projects in India.
The news triggered a decline in the value of Adani Group’s overseas bonds. Notably, a bond from Adani Ports due in 2041 fell by 2.4 cents, while another from Adani Renewable Energy dropped by 2.3 cents, marking the steepest decline since February 2023. The losses have wiped out recent gains that the bonds had made following recovery from the damaging Hindenburg Report last year.
The investigation comes amid other financial setbacks for the conglomerate, including a Supreme Court ruling against Adani Power Rajasthan Ltd, which dismissed its plea for over ₹1,300 crore in payment surcharges from a Rajasthan government utility. This decision added to the group’s struggles, with all listed Adani stocks closing in the red.
The US investigation focuses on allegations that Adani Group executives paid over $250 million in bribes to Indian officials between 2020 and 2024 to secure contracts for solar energy projects. The Adani Group, however, denied any knowledge of these allegations, stating that it has not been contacted by US authorities.
The investigation adds to the growing scrutiny of the conglomerate's practices, following a tumultuous year marked by accusations of fraud and stock manipulation by US-based short-seller Hindenburg Research. These allegations led to a sharp decline in Adani Group's market value earlier in the year and prompted investigations by Indian regulators.
Investors are closely monitoring developments, as the outcomes could have far-reaching implications for the Adani Group’s financial stability and international reputation. The situation has also drawn attention to corporate governance practices within India’s largest companies
