Hindenburg: Fraud can't be obfuscated by nationalism

US short seller Hindenburg Research intensified its fight against the Adani Group on Monday by highlighting how the ports-to-power conglomerate’s 413-page response to its critical report ignored key questions, especially the ones tied to suspect transactions with offshore entities.

The Adani Group failed to specifically answer 62 of its 88 questions and tried to lead the focus away from substantive issues and instead stoked a nationalist narrative, the US group pointed out.

“To be clear, we believe India is a vibrant democracy and an emerging superpower with an exciting future. We also believe India’s future is being held back by the Adani Group, which has draped itself in the Indian flag while systematically looting the nation,” Hindenburg said in the statement titled ‘Fraud Cannot Be Obfuscated By Nationalism’.

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Monday’s comments came a day after the conglomerate led by Asia’s richest man Gautam Adani labelled the US firm’s allegations as “a calculated attack on India”.

Last week, Hindenburg released a report accusing the Adani group of using a web of companies in tax havens to inflate revenue and stock prices even as debt piled up.

On Monday, the US firm also flagged how the Adani Group failed to answer many specific questions, including those on Adani’s elder brother Vinod Adani’s role in running several offshore shell entities in tax havens and using them for stock manipulation. Shares of most Adani firms fell on Monday despite the conglomerate’s weekend rebuttal to Hindenburg’s allegations.

The selloff after the report has now eroded more than Rs 5.56 lakh crore of market value amid a share sale by Adani’s flagship firm. Its dollar bonds also fell further on Monday after the company’s response failed to ease concerns tied to Hindenburg’s charges.

On the Indian bourses, most of the Adani Group companies — except Adani Enterprises, ACC and Ambuja Cement — closed lower, with as many as four of them hitting the lower circuit intraday, which meant no further trading in those stocks was allowed due to no buyers.