DLF chairman K P Singh said what Adani Group is facing with Hindenburg Research is something he faced 15 years ago ahead of the real estate firm’s IPO.
Singh told PTI how a Canadian firm had threatened to bring out a report when DLF was bringing out an IPO one-and-a-half-decade back.
”We said push-off (to the Canadian firm)… do whatever you can ,” he said, adding there are ‘blackmailers’ who bring out reports around any big share sale.
Singh said the turmoil engulfing Gautam Adani’s business empire following damning allegations by the US short seller has not shaken the faith of global investors in India and rubbished suggestions that banks would have lent to Adani Group on instructions from higher-ups.
The Hindenburg report that alleged accounting fraud and stock manipulation at the Adani group, came just as a Rs 20,000 crore follow-on share sale of the conglomerate’s flagship firm Adani Enterprises opened.
”Completely nonsense,” he said on the Adani-Hindenburg row impacting India’s attractiveness as an investment destination. ”India is too big a country today. So this story will die down. Investment will not be hurt.” Modi is ”a sensible and dynamic person” and ”so long as he remains prime minister India will remain an attractive destination, he said.
Exclusive | VIDEO: “He has to beef up his capital to reduce debt. I wish him good luck”: Indian real estate doyen KP Singh on Adani. pic.twitter.com/qg8Y018qMQ
The ports-to-airport conglomerate has denied all allegations, calling them ”malicious”, ”baseless” and a ”calculated attack on India”.
The Adani group’s listed firm lost about USD 125 billion in market value in three weeks after the report. Some recovery has been seen in the last couple of days.
While the group’s rapid expansion – from cement to hydrogen and data centres, has largely been fuelled by debt funding, Singh, who is now chairman emeritus of DLF, said suggestions that banks lent money to the Adani group because of Prime Minister Narendra Modi telling them to do so was rubbish.
”What has the prime minister got to do with it (lending money to a corporate)? No banker, even if the prime minister tells anything, will give money unless it is justified,” he said.
”I have no clues about Adani but if somebody thinks today that a call from the prime minister will make bankers give (loan) then they are living in a fool’s world. No banker will do this thing.” Citing the example of former ICICI Bank chief executive Chanda Kochhar, who was arrested on charges of irregularities in loans to Videocon Group, he asked, ”Would any banker do anything which is not according to the regulations? No, they won’t.” Opposition parties used the Hindenburg report to attack the government, alleging Modi aided the Adani group’s rise.
The Prime Minister has not referred to Adani by name since the crisis triggered by the Hindenburg report but earlier this month he told Parliament that the ”blessings of 140 crore people in the country are my protective cover and you can’t destroy it with lies and abuses”.
Singh said Modi need not respond and should continue to do his job.
”So many dogs will bark, he should not respond to it. System will take care. They will go away. He should continue doing what he is doing,” he said.
On the troubles facing Adani group, he said entrepreneurs are risk takers but it’s always smart to strike a balance between equity and debt.
Adani’s rival Mukesh Ambani has done the smart thing of balancing debt by bringing in equity investors across businesses.
”Every businessman goes through this thing. In your zest for growth, you get debt. (But) Balance debt with equity. And grow again,” he said, adding Adani was trying to do that through the FPO of Adani Enterprises.
Adani group has maintained that its debt of Rs 1.96 lakh crore as on September 2022 was balanced with assets it has and the revenues all the businesses are generating.
”Always have a healthy balance between equity and debt. At the moment Adani seems to have heavy debt. So I wish him good luck, I don’t know but eventually, he has to beef up his capital,” Singh said.
A “crazy nut” and an aged “barking dog” is how real estate doyen Singh described billionaire financier George Soros, who caused an outrage in India after saying the Adani-Hindenburg turmoil would lead to weakening of Prime Minister Narendra Modi’s grip on power.
“When you do something well, so many dogs bark. Do you respond to each dog? No. Dogs bark but quieten after some time,” he said. On comments made by Soros at the Munich Security Conference, he said, “the fact of the matter is that when you rise others try to pull you down.” “He is a crazy nut, completely,” he said. “Although he is younger than me. I am 93 (and he is 92) but at that age there is sometimes confused thinking, by nature,” he said in an hour-long interview with PTI.
With inputs from PTI
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