The Indian government has not engaged itself in the Adani Group’s dispute with a US short seller Hindenburg Research, which has triggered a massive rout in the company’s shares, said Sanjeev Sanyal, Member of the Economic Advisory Council to Prime Minister Narendra Modi.
“The government has not intervened anywhere. Nobody’s having to rescue anyone in our system,” Bloomberg quoted Sanyal as saying.
The State Bank of India, the country’s largest financier, and the Life Insurance Corp., the country’s largest life insurer, have extremely small exposures to Adani group companies, said Sanyal, adding that none of the companies is in financial distress.
LIC, which has assets under management of about $539 billion, had exposure to Adani to the tune of over $4 billion.
Sanyal reiterated that our job is to make sure the markets are transparent and liquid and functional. “Transparency and orderly market movement is the only thing we care about. If that is maintained, the prices will sometimes go up, sometimes they’ll come down,” he added.
According to Sanyal, the recent failure of Silicon Valley Bank will have no immediate impact on India’s startups.
The Adani Group crisis started when the US-based short seller firm Hindenburg Research, led by Nathan Anderson accused the conglomerate of stock market manipulation, money laundering, and accounting fraud via shell firms. The report caused a massive rout in the shares of Adani Group companies.
Even though the Adani Group has denied all these allegations, Gautam Adani lost around $61.7 billion of his wealth on a year-to-date basis. Adani was worth $58.90 billion on Wednesday, much lesser than $150 billion in September 2022.
Meanwhile, the combined market capitalisation (m-cap) of seven-listed firms namely Adani Enterprises, Adani Green Energy, Adani Ports and Special Economic Zone, Adani Power, Adani Total Gas, Adani Transmission and Adani Wilmar tanked by more than Rs 4.50 lakh crore to Rs 8.63 lakh crore on March 23, 2023, from Rs 13.20 lakh crore on March 31 last year.
Also Read: Adani Group stocks in FY23: All are down, except one; meet the lone ranger