Hungarian-American businessman and billionaire philanthropist George Soros believes the turmoil at Gautam Adani’s business empire may weaken Prime Minister Narendra hold on the government of India, PTI reported.
Adani group has been under severe pressure since the US short-seller Hindenburg Research on January 24, accused it of accounting fraud and stock manipulation. However, Adani had denied the allegations.
While listed companies of the group lost over USD 125 billion in market value in three weeks, opposition parties inside and outside Parliament attacked the BJP government for the meteoric rise of the ports-to-energy conglomerate. Stocks of most group firms have risen in the last couple of days.
According to the news agency report, Soros, in a speech at the Munich Security Conference on Thursday, said Modi would “have to answer questions” from foreign investors and Parliament on allegations the Adani group is facing.
Soros said the turmoil at Adani may open the door to a democratic revival in the country.
Meanwhile, his speech drew sharp reactions. BJP said Soros was not only targeting the Modi but also the Indian democratic system.
Pertinently, Adani Group stocks have taken a beating on the bourses after the Hindenburg Research made a litany of allegations, including fraudulent transactions and share-price manipulation, against the business conglomerate.
The report titled ‘Adani Group: How The World’s 3rd Richest Man Is Pulling The Largest Con In Corporate History’, questioned the accounting and corporate governance practices of Adani Group, and also raised the issue of heavy debt.
The report claimed that the Adani Group companies participated in a clear stock manipulation and accounting fraud scheme over decades. The report also led shares of the Indian giant to go down.
The Hindenburg Research report was prepared after two years of research and investigation by this forensic financial research firm.
In an official tweet, Hindenburg Research wrote, “Today we reveal the findings of our 2-year investigation, presenting evidence that the INR 17.8 trillion (U.S. $218 billion) Indian conglomerate Adani Group has engaged in a brazen stock manipulation and accounting fraud scheme over the course of decades.”
The research alleges that Gautam Adani has managed to amass a net worth of nearly $120 billion, largely through stock price appreciation over the last three years. It also alleges that the group’s seven key listed companies have spiked at an average of 819 per cent over the entire period.