Opinion
Adani stock surge: Guess why
Summary
- It’s not just hardened expectations of political stability. Reports have surfaced of a US agency having deemed the Hindenburg allegations irrelevant.
Adani Group stocks have been on a roll lately. They leapt after 24 November, when the Supreme Court reserved its judgement on petitions asking for an inquiry of January’s crash triggered by a Hindenburg Research report charging the group with stock manipulation, accounting fraud and much else, all flatly denied by the group.
The report’s veracity was not known, observed the apex court. Together with reports of benign findings by India’s market regulator, that was taken as good news for Adani shares. On Tuesday, these hit the spotlight again, rising between 10% and 20% after Adani Green said it had secured $1.36 billion in additional funding. This was another sign that its ability to raise big capital was intact, so all listed group firms would enjoy a rub-off.
But was there another significant wind in its favour? Reports surfaced that a US government agency had deemed the Hindenburg allegations irrelevant, enabling a loan to Adani for a container terminal in Sri Lanka, whose ports are seen to be in geopolitical contest. This may have been taken as a big prospect brightener for the group. Of course, political stability helps and recent poll results tick that box as well.
