Board Felt FPO ‘Morally Wrong’ Considering Volatility, Says Gautam Adani
Adani Group Chairman and Founder Gautam Adani released a video early on Thursday addressing the topic of shocking withdrawal of its Rs 20,000 crore FPO.
The industrialist said that the Board of directors at Adani Group strongly felt that the FPO would be “morally incorrect” considering the volatility observed in the markets on Wednesday.
On Wednesday, all the Adani stocks saw a steep fall after Credit Suisse stopped accepting bonds of Adani group as collateral for margin loans to its private banking clients. The move seemed to have spooked even the Indian banks as most saw red in the market yesterday.
“For me, the interest of my investor is paramount and everything is secondary. Hence, to ensure the investors from potential losses, we have withdrawn the FPO,” Gautam Adani said.
Now the 15th richest man in the world, Adani said that the withdrawal of FPO would not impact any existing operations of his conglomerate, as well as its future plans.
It has been a shocking two weeks for the Adani Group ever since the allegations of fraud came to light from a report by short-seller Hindenburg Research.
With the scrapping of FPO, Adani investors would be worried about what’s to come even as some media reports suggest that Indian markets regulator is looking into the company.
“Our balance is healthy and assets robust. Our immediate levels and cash flows have been very strong, and we have an impeccable track record of fulfilling our depth obligations. We will continue to focus on a long-term value creation and growth will be managed by our internal accruals,” Adani said.
He also added that his company would review its capital market strategy once “market stabilises”.
Speaking to BW Businessworld on Wednesday, British economist Lord Meghnad Desai said that it doesn’t matter if the Hindenburg report is accurate or not but the market has “bought it”.
Adani Enterprises stock value dropped 10 per cent at the opening bell on Thursday, continuing its freefall from Wednesday.
Also Read: Adani Group Calls Off FPO, Will Return Money To Investors
