Fresh bout of selling sees Adani m-cap go down by Rs 25,000 crore

Reports of a large ESG fund dumping stake lead to renewed turbulence

The majority of Adani Group stocks declined on Monday amid news reports that a large environment, social and governance (ESG) fund has dumped its stake in one of the group companies.

A news report suggested that KLP, a Norwegian pension fund, has sold its entire stake in Adani Green Energy (AGEL), following concerns that the company’s shares might have been pledged to fund the Carmichael coal project in Australia.

More than 500 funds registered in the European Union as ‘promoting’ ESG goals hold Adani stocks, either directly or indirectly, according to data compiled by Bloomberg.

Six of 10 Adani stocks ended the session with losses. Flagship Adani Enterprises (AEL) tumbled the most at 6 per cent, Adani Total Gas, Adani Transmission, and AGEL each hit their 5 per cent down limit.

NDTV fell 3.7 per cent and Adani Wilmar lost close to 2 per cent. In total, the group’s market capitalisation declined nearly Rs 25,000 crore on Monday. Since January 24 when US-based short-seller Hindenburg Research came out with its report, Adani’s market capitalisation declined nearly Rs 11 trillion.

The group stocks had recouped some of the losses in early February after promoters prepaid loans worth $1.11 billion, thus releasing the pledges in AGEL, Adani Ports and Special Economic Zone, and Adani Transmission. The report released by Hindenburg Research had accused Adani firms of brazen stock manipulation, accounting fraud, and use of extreme leverage, spelling danger for its creditors.