Whatever the truth, a fast-rising business empire should expect increased scrutiny as its stakeholders increase. Levels of transparency ought to rise accordingly
Just two days ahead of the ₹20,000 crore follow-on public offer (FPO) of Adani Enterprises, the Gautam Adani-led group’s listed shares were hit by allegations of being ensnared in a web of dodgy dealings, stock manipulation, financial smoke-and-mirrors and over-leverage, levelled by US-based Hindenburg Research, which declared it held short positions on Adani securities. On Wednesday, its stocks ended 1% to 8% down, rattled by the report’s claims of alleged accounting fudge and global operations via shell companies in tax havens. The Adani group dismissed the charges as “malicious", saying the report’s timing betrayed a mala fide intention to harm its FPO. If this is an ill-motivated release, an attack, a probe should be able to establish it. Concerns about the group’s finances, however, have been raised previously as well, though it’s one thing to speak of indebtedness risks and another to pinpoint wrongdoing, which is a job for experts. Whatever the truth, a fast-rising business empire should expect increased scrutiny as its stakeholders increase. Levels of transparency ought to rise accordingly. The Adani group faces a choice. And it’s best if it opts to come out with point-by-point rebuttals.