Adani Group Stocks and Bonds Slide on US Bribery Probe News

Adani Group Stocks and Bonds Slide on US Bribery Probe News

Shares and bonds of Adani Group companies took a tumble on Monday after a report surfaced alleging a widened US investigation into the conglomerate. This news comes just over a year after another US short seller report caused a similar market stir.

The investigation reportedly focuses on whether Adani entities or individuals connected to the company, including Gautam Adani himself, bribed Indian officials to secure favorable treatment on an energy project. This allegation, reported by Bloomberg on Friday, sent shockwaves through the market.

Adani's dollar-denominated bonds witnessed their biggest daily decline in six to twelve months. Prices of these bonds fell, driving yields significantly higher. The yield on a note issued by Adani Ports & Special Economic Zone, maturing in February 2032, jumped a substantial 38 basis points to 7.20%. This follows an even steeper intraday rise of 54 basis points, marking the highest single-session increase since February.

Similarly, shares of all ten companies associated with the Adani Group fell by over 5% in early trading on the Indian stock exchange. Adani Total Gas led the decline, experiencing a particularly sharp drop. The Adani Group has yet to respond to a request for comment from Reuters.

It's important to note that this isn't the first time the Adani Group has faced scrutiny. In January of last year, a report from US short seller Hindenburg Research triggered a significant sell-off in the group's stocks and overseas bonds. The Adani Group vehemently denied all allegations of wrongdoing.

While most of the group's foreign bonds and domestic shares have since recovered from the Hindenburg report's initial impact, this new investigation casts a shadow of uncertainty. Investors will be closely monitoring developments as the US probe unfolds.


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