Shares in the companies of India’s wealthy Gautam Adani, one of Asia’s richest men, have plummeted after the country’s largest securities depository froze the accounts of billions of dollars worth of foreign equity funds.
Four of the six listed Adani Group companies fell as much as allowed by the exchange rules on Monday, while the billionaire Adani Ports & Special’s economic zone fell by 19%.
The decline came after the Indian National Securities Depository announced that it had frozen the accounts of Albula Investment Fund, Cresta Fund Invest APMS Investment Fund in Mauritius. The Indian newspaper The Economic Times reports that the move, which prevents the sale of funds in shares, is due to the lack of documents on the beneficial ownership of the entities.
Adani’s net worth has grown from $ 44 billion to $ 78 billion this year, driven by a rise in shares of its energy-related apple union. That pushed him to the position The second richest man in Asia, passing Chinese tech titans such as Alibaba’s Jack Ma և ByteDance founder Zhang Yiming և touching distance from Reliance Industries chair Mukesh Ambani,
According to Bloomberg, the fall of Adani shares on Monday paid off more than $ 6 billion of the tycoon’s net worth, which was under $ 71 billion.
Shares of Adani Transmission rose 640 percent last year, Adani Enterprises 860 percent and Adani Total Gas 1030 percent.
But analysts have expressed concern about the stocks held by a handful of foreign funds and a small public outcry.
Last week, analysts at Bloomberg Intelligence wrote in a post that the rally of shares of Adani Total Gas, Adani Enterprises and Adani Transmission seems “extended”.
“Among the largest foreign investors are several funds located in Mauritius, which have more than 95% of assets in these companies,” say analysts. “Such centralized positions, along with negligible coastal ownership, create asymmetric risk compensation, as large investors are clearly avoiding Adani.”
Adani Group declined to comment. The NSD did not immediately respond to a request for comment.
The Indian Stock Exchange has recently hit record heights even as the economy struggles to recover from a severe second wave of coronavirus infections.
The provider of MSCI indexes added three Adani shares to the Indian index in May.
Adani has attracted international partners to become one of the world’s largest renewable energy companies. General In January bought a 20% stake in Adani Green Energy last month obtained India’s energy unit, SoftBank Japanese Technology Group.
Infrastructure tycoon has been criticized for being controversial Karmaykhel coal mine In Australia, which has become the subject of global environmental protests.