Large investors pull Adani's US$2.5 billion share sale through after stock rout

MUMBAI:  Adani Group’s ambitious share sale exceeded its subscription targets Tuesday (Jan 31) in a relief for the Indian conglomerate, which is reeling from allegations of “brazen” corporate fraud that wiped more than US$65 billion off its value.

The success of India’s biggest follow-on public offer (FPO) is the first reprieve in a horror week for the sprawling business empire of Gautam Adani – still Asia’s richest man despite a bruising US$36 billion hit to his personal fortune.

Large institutional investors swooped in on the offer’s final day, even as some of the firm’s listed companies were hammered in trade and smaller retail investors steered clear.

“Thank you for the support provided in making the Adani FPO a success during the most unprecedented and challenging times,” a public relations representative for the conglomerate said in a statement.

The US$2.5 billion share offer was 112 per cent subscribed by Tuesday afternoon, driven by corporate institutions, foreign funds and other large investors.

But retail investors bid for only 12 per cent of their category, despite additional discounts, impeding Adani’s plans to expand his shareholder base and invite “the average, normal Indian mom and dad as shareholders”.

Shares in flagship Adani Enterprises closed 3.35 per cent higher on Tuesday but remained well below the 3,112 to 3,276 rupees price range set for the FPO, making them cheaper to buy on the open market.

Adani Transmission, Adani Green Energy and Adani Ports closed 3.73, 3.06 and 2.67 per cent higher respectively.

But Adani Total Gas saw another day of dramatic falls with trading halted for another session after diving 10 per cent in the morning.

The natural gas distribution company – of which France’s TotalEnergies owns 37.4 per cent – has lost 45 per cent in market value over the past week.

Adani Power and Adani Wilmar also hit their circuit breakers after falling five per cent each.

Founder Adani, 60, was the world’s third-richest person last week but has now slipped to eighth place on Forbes’ real-time global rich list.


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