The Adani Group explained on Monday that a report that the National Securities Depository Ltd (NSDL) had frozen the accounts of three foreign funds that possess shares worth Rs 43,500 crore in four of its firms was “blatantly erroneous and done to intentionally mislead the investing community.”
“With respect to the status of the aforesaid funds’ Demat Account and have their written confirmation via its e-mail dated 14th June, 2021, clarifying that the Demat Account in which the aforesaid funds hold the shares of the Company is not frozen,” Adani Ports and Special Economic Zone Ltd said in a BSE filing.
As for the report, the company further stated, “This is causing irreparable loss of economic value to the investors at large and reputation of the group.
“We are sending this letter in the public interest and to defend the interests of minority investors,” it said.
On Monday, shares of Adani group companies plummeted by between 5% to 25% after the NSDL froze the accounts of three foreign funds that are among the firm’s biggest stakeholders.
The conglomerate’s flagship firm, Adani Enterprises, fell as much as 25%, the sharpest drop in in a decade. Adani Ports and Special Economic Zone, which is listed on the Nifty 50, dropped as much as 19 percent before recovering part of its losses.
According to Reuters, the NSDL has suspended the accounts of Albula Investment Fund, Cresta Fund, and APMS Investment Fund, according to its website, without stating a cause for the block.
As of March 31, 2020, the three funds were among the top twelve investors, with shares in five Adani Group firms ranging from 2.1 percent to 8.91 percent, according to annual investor presentations.
According to Reuters estimates, the value of their holdings in Adani Power, Adani Enterprises, Adani Green, Adani Transmission, and Adani Total Gas Ltd has increased tenfold since end-March 2020, to 569.32 billion rupees ($7.78 billion) as of Friday.
This is in line with a wide increase in Adani Group shares throughout the time, making Chairman Gautam Adani the second wealthiest Asian after Mukesh Ambani, the chairman of oil-to-telecom giant Reliance Industries.
Adani Enterprises’ stock has increased by more than tenfold in the year to Friday, while Adani Transmission’s stock has increased by more than eightfold, and Adani Total Gas Ltd’s stock has increased by 1,114 percent.
Over the last year, Adani Ports Ltd has increased by 148%, while Adani Green has increased by 267 percent, and Adani Power has increased by nearly fourfold.
A request for response from an Adani official was not immediately returned. SEBI and NSDL, India’s securities regulators, did not reply to requests for comment.
According to a storey in the Economic Times, the three accounts may have been frozen due to a lack of disclosure of beneficial ownership information.
