Gautam Adani has found his way back into the world’s top 20 billionaires list as his conglomerate makes a stellar recovery after bleeding for weeks on the stock exchange.
The Adani group chairman, whose net worth has risen by $4.38 billion this week to $64.2 billion, is now ranked 18th on the Bloomberg Billionaires’ Index. In September 2022, he was the world’s second richest person on the list with a net worth of $154 billion.
Then, in January this year, US-based Hindenburg Research alleged “brazen stock manipulation” and “accounting frauds” by the group. Investors dumped Adani group stocks over the next months, resulting in an erosion of $56.4 billion from his personal wealth.
However, this week, the shares of Adani Enterprises, the group’s flagship, have risen 34%. Stocks of its recent acquisitions, Ambuja Cements and ACC, have risen by 5% and 3.5%, respectively. Its crown jewel, Adani Ports, has gone up by nearly 9%; Adani Wilmar, another group company, rose by a little over 20%.
Today (May 25), the overall market capitalization of the 10 Adani Group stocks stood at $126 billion, up nearly $13 billion over the week. However, this is still significantly lower than its peak of $232 billion on Jan. 24, the day Hindenburg released its report.
What led to the rise in Adani’s share prices?
The rally in stock prices began earlier this week after the Supreme Court-appointed panel, in its 173-page report, said there was “no evident pattern of manipulation” yet by the group which can be attributed to “any single entity or group of connected entities.”
The Securities and Exchanges Board of India is still probing Hindenburg’s allegations, but the market seems to have taken the apex court’s recent observation as a clean chit to Adani.
A fresh impetus to Adani’s fundraising plans from the US-based investment firm GQG Partners has also boosted investors’ optimism.
Besides retail investors, the Adani stock’s revival has cheered India’s largest insurer Life Insurance Corporation (LIC), too.
The value of LIC’s Adani investments has also recovered
The rebounding Adani stock has replenished more than half of LIC’s wealth lost in the Hindenburg-led implosion.
India’s largest institutional investor holds 9.12% in Adani Ports, 6.41% in ACC, and 6.3% in Ambuja Cements. Its other Adani holdings include Adani Total Gas (6.02%), Adani Enterprises (4.26%), Adani Transmission (3.68%), and Adani Green Energy (1.36%).
The combined value of these holdings stood at $5.4 billion yesterday (May 24), recovering by $2.2 billion from the lowest level it fell to—at $3.2 billion, down 11% from purchase value.