Each one of their allegations is a lie
Still bristling at the allegations made by self-proclaimed short-seller Hindenburg Research, Jugeshinder “Robbie” Singh, the chief financial officer of Adani Group, put up a confident front on Sunday evening, stating that the follow on public offer (FPO) of flagship Adani Enterprises will continue as scheduled.
The Adani group has launched a full-scale operation to redeem its image, with the group CFO saying it will file before regulators, stock exchanges, and other stakeholders “documentary evidence” that the (Hindenburg) report is a “litany of misrepresentations, falsehood”.
Hindenburg’s representation of these disclosures, in some cases ignore a Supreme Court (judgement), “in another case, the high court making a judgement, and ignoring those and still raising questions,” Singh fulminated. “It raises malicious intent and the deliberate attempt to mislead the public and other stakeholders. “We will provide in full documentary form, and that is why our core long-term strategic institutional investors have reposed faith, and we are continuing with the FPO as scheduled.” As for Singh, an Australian citizen with a Person of Indian Origin card, his daily calendar, even after the Hindenburg ambush, is unchanged and includes a morning and evening tryst at the gym. Edited Excerpts:
Is there a plan B for the FPO because the share price is at an 11% discount to the offer price? Why will investors apply when the stock is available cheaper?
There are two aspects to it. The question is relevant to retail investors, and it may put a significant dent in retail participation. But from a strategic, long-term institutional participation, the value of Adani Enterprises going up or down 5-10% is less relevant because fundamentally, the valuation is in the airports business, in Adani New Industries in data centres, value sits in the road business, etc., and those businesses are going perfectly well. At the portfolio level, this Sunday, the group made ₹1,100 crore in Ebitda. Next week, the group will make another ₹1,100 crore Ebitda. The long-term investor will look at the value of these businesses, and that is still exactly the same. As Adani Enterprises shareholders, they will get those businesses as shares. That’s where the value is, and they will eventually What gives you the confidence to go through with the FPO?
We have the information based on our roadshow. And we are confident about that.
Are you disconcerted by the fact that the market was ready to believe the Hindenburg report?
I’m a student of history and I come from Punjab. It doesn’t surprise me. In Jallianwala Bagh, only one Englishman gave an order, and Indians fired on other Indians. So am I surprised by the behaviour of some fellow Indians? No. A white person gave an order that some Indians should fire is a possibility. While you said most assertions in the report are based on your own disclosures,
there are certain other aspects, such as round-tripping allegations
One round-tripping, they say, is that $1 billion was provided to Adani Power by one of the family companies, and they have asked the question of where that one billion came from, and their insinuation is that it is round-tripping. In that transaction, Adani Power acquired Essar Mahan from the IBC process. The committee of creditors accepted that bid, and it was approved by the NCLT and was subject to NCLT judgement. Within that process, the resolution professional came up with the sustainable debt numbers, and that number was of Indian domestic banks. There was an ECB debt provided to Essar Mahan, which was considered unsustainable and therefore was worth only $100. ECB debt cannot be acquired by domestic corporate. And, therefore, from a disclosed entity, we acquired that debt for $100. And this is what they call round tripping of $1 billion. If they had done any research, they would have known that it was an NCLT order. And therefore, they have deliberately done this to buttress the case of round-tripping. This is a factual misrepresentation and almost bordering on a deliberate lie. We will respond to each one of them. Each one of them is such a lie.