Adani Group raises $1 billion in share sale via QIP, first since Hindenburg row

Adani Energy Solutions Ltd—the power transmission unit of the Adani Group—raised $1 billion through a share sale on Tuesday, July 30. Marking a market return, this was the first ever public equity fundraise by billionaire Gautam Adani's ports-to-power conglomerate since the Hindenberg-led market rout. 

Adani Energy Solutions Ltd raised the funds through a qualified institutional placement (QIP) issue. The QIP, which opened on Tuesday, was oversubscribed three times with demand of about ₹26,000 crore, making it the largest transaction in India's energy space. The issue closed at ₹1,135 per share, as against the issue price of ₹976 per share, or a 14 per cent listing discount.

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QIP is an instrument used by listed companies to raise funds from several large institutions. Marquee investors such as GQG, QIP, ADIA, and a few top names in the US participated in the QIP. Domestic institutions, including Bandhan Mutual Fund (MF), Nomura, and 360 India Infoline, participated in the issue.

According to news agency Reuters, Abu Dhabi Investment Authority and Qatar Investment Authority invested in Adani Energy Solutions for the share sale. The share sale was for $700 million, with a so-called greenshoe option for a further $300 million. 

Adani Energy's shares rose about seven per cent on Tuesday before settling 6.95 per cent higher at ₹1,125.40 apiece on the BSE. However, the stock is roughly 60 per cent lower than its levels before Hindenburg levelled accusations against the group.

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Adani-Hindenberg Market Rout

The fundraising was the first since the group's flagship firm scrapped a ₹20,000 crore issue in February 2023 following the Hindenburg report. In January 2023, the US-based short seller Hindenberg Research released a scathing report accusing the Adani Group of accounting fraud, improper use of offshore tax havens, and stock manipulation. The report wiped away billions in shareholder value. 

Although the Adani Group vehemently and repeatedly denied all allegations, the conglomerate's listed companies at one point saw over $150 billion of their market value wiped out. While the group has largely recovered, a successful QIP is seen as a powerful vote of investor confidence in the business tycoon. Since the Hindenburg report, the Adani Group companies have raised more than $670 million through listed rupee bonds and one-dollar bonds.

Also Read: Adani Power Share Price Highlights : Adani Power closed today at ₹729.15, up 1.73% from yesterday's ₹716.75

Adani Group returns to market

Separately, Adani Enterprises Ltd, the group's flagship firm, is looking to revive its first-ever public bond sale. It plans to raise as much as ₹600 crore. The company has hired Trust Investment Advisors, AK Capital Services and Nuvama Wealth Management as lead managers for the issuances.

The group tapped the dollar bond market in March this year—the first time since the Hindenburg report—when its solar energy unit Adani Green Energy and associated firms received bids of about $2.9 billion. In a stock exchange filing, Adani Energy Solutions said its management authorised the opening of the issue on Tuesday and approved the floor price, which was set at ₹1,027 per equity share. CareEdge has assigned an A rating to Adani Enterprises' bonds.

With inputs from BSE, PTI, Reuters