Is Adani doing any fraud?

Even the Harvesting of Cauliflower could take anywhere between 75–85 days. But I have heard commercial cultivation takes much lower time through growth-inducing processes which are not very good for health. Consumption of Cauliflower quite often leads to hyperacidity and gas. Adani’s growth or rise is much faster than the commercially cultivated cauliflower. It would definitely cause indigestion. Organically grown cauliflowers are generally not of very big size. The big-size, spotless cauliflowers are quite often products of induced growth. Some of the Adani houses have grown by a few thousand percent over the last five years. So people can understand what kind of growth they could be.

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I have kept this article very simple. However, someone in the comment section wanted to battle it out. His strength of argument is that foreign banks have invested in the Adani Group. His argument is that international banks can not be oblivious to what an author in Quora would know. Quite a strong argument. However, my response is that the Hindenburg financial report is also from an international organization. Nathan Anderson who founded Hindenburg Research in 2017, would definitely not be oblivious to the fact that international banks also finance the Adani Group enterprises.

Hindenburg Research’s explosive 32,000-word report, which alleges that the Adani Group and its principals have engaged in a years-long scheme of fraud and stock market manipulation. (The Adani Group has denied all wrongdoing and says it is considering legal action against the investment firm.)

In recent years however, U.S and European-based investment banks have stepped up to help the Adani Group raise billions of dollars through equity sales, refinancings and U.S. dollar debt offerings. In addition to the Adani Group’s “relationship” banks, J.P. Morgan, Bank of America Merrill Lynch and Credit Suisse have all brokered deals on behalf of Adani-owned companies.

Between 2015 and 2021, six different Adani Group companies raised about $10 billion through U.S-dollar-denominated bond sales that were underwritten by U.S. and European investment banks, according to financial market data provider Refinitiv. Of these 18 bond offerings, 14 were done between May 2019 and September 2021. One of these companies, Adani Ports & Special Economic Zone - which receives preferential tax treatments - was responsible for half the debt raised.

These figures do not include the Adani Group’s debt issued in Rupees and other currencies. The conglomerate had about $27 billion in outstanding liabilities as of March 2022. The State Bank of India provided funding for about 40% of debt Adani firms issued between 2020 and 2022.

Let’s wait and see whether Adani initiates legal action against the Hindenburg report in the US court. Please remember to fight a legal battle in the US court is not exactly like that in India. In India, you can simply pull it on and on for years. In the US cases are decided much faster and there is no way you can pull it around. Unless of course if Adani somehow manages to put it on the slow paddle pulling some string. If the judgment goes against Adani, it could be disastrous. And I am afraid that Adani could lose the battle.

Meanwhile, Barclays, Deutsche Bank, JP Morgan, and Bank of America all declined to comment on their relationship with the Adani Group. Standard Chartered Bank said it doesn’t comment on client relationships due to confidentiality. And Credit Suisse had not responded at the time of publication. Secondly, we need to wait for more details about these international banks’ dealings to come out. I mean to say who all were guarantors for Adani, was there any counter-guarantee, what nature of the debt was, how much was the bond sale value, what was the margin offered, what was the refinance amount, etc. We don’t need to be jumpy. My only point is that what I said in many of my articles has been endorsed by a report from a US-based international firm. People can refer to my answer given in the reference.

Last but not the least people need to understand that the entire amount Adani Group raised through foreign banks is not in the form of loans. The majority of them are through offshore bond sales. If we get to know who are those buyers the actual story would come out. I am sure there will be some great story to tell if the details are leaked out. Plus these are the way the corporate raiders make hostile takeovers. They will extend you loans, and credits through unsuspecting houses and wait for the right time to make takeover bids. So investment by foreign banks need not be a character certificate for Adani.