Adani hikes stake in flagship firm

Billionaire Gautam Adani-led promoter group has increased its stake in the group's flagship firm as the ports-to-energy conglomerate continues to recover from the effects of a report by US short-seller Hindenburg Research.

Promoter group has increased stake in Adani Enterprises Ltd from 67.65 per cent to 69.87 per cent, according to a stock exchange filing.

Promoter group firm Kempas Trade and Investment Ltd, which had a minimal stake in the firm, acquired 2.22 per cent in the open market between August 7 and August 18, it said.

The stake increase comes at a time when US-based boutique investment firm GQG Partners has been buying shares in Adani group firms.

GQG has increased its stake in Adani Ports & Special Economic Zone (APSEZ) to 5.03 per cent last month by way of a bulk deal, stock exchange filings showed.

GQG now has a stake in five of the 10 Adani Group firms. On August 16, it bought a 7.73 per cent stake in Adani Power Ltd. Promoter group firms Worldwide Emerging Market Holding and Afro ASIA Trade And Investments sold an 8.09 per cent stake in Adani Power through block deals on August 16.

Of this, GQG bought 7.73 per cent, filings showed.

After the stake sale, promoter holding in Adani Power declined to 66.88 per cent from 74.97 per cent.

The investment comes days after Deloitte quit as auditor of APSEZ, renewing investor concerns even as the group slowly recovers from the effects of a report by US short-seller Hindenburg Research.

The Hindenburg report released on January 24 alleged accounting fraud, stock price manipulation and improper use of tax havens, triggering a stock market rout that had erased about $150 billion in the market value at its lowest point.

Adani Group has denied all allegations by Hindenburg and is plotting a comeback strategy that includes recasting its ambitions, scrapping acquisitions, pre-paying debt to address concerns about its cash flows and borrowings, and scaling back its pace of spending on new projects.

GQG has, however, shrugged off the allegations and has since May invested in Adani firms. GQG had previously picked up a 5.4 per cent stake in Adani Enterprises, a 6.54 per cent stake in Adani Green Energy Ltd and a 2.5 per cent stake in Adani Transmission Ltd.

Adani stocks have since recovered some of the losses.

GQG has so far invested Rs 38,700 crore in Adani Group firms. Qatar Investment Authority (QIA) has invested Rs 4,100 crore in Adani Green Energy and Bain Capital has poured in Rs 1,440 crore, helping re-build investor confidence.

In addition to stake sale by promoters, the three portfolio companies have received board approvals for primary issuances through a share sale to investors.

Adani Enterprises plans to raise Rs 12,500 crore through share sale to investors while Adani Transmission plans to mop up Rs 8,500 crore.

Adani Green Energy plans to raise Rs 12,300 crore. Adani Enterprises is incubating the green hydrogen projects while Adani Green Energy is the renewable energy arm that is building 45 GW of capacity by 2030. Adani Transmission lays lines to wheel such power.