Recently the share price of Adani’s publicly traded companies has declined drastically. The main reason for this decline is the bribery case against Adani in the United states. The United States Securities and Exchange commission has issued a summons to Adani group’s founder and executive directors for 250 million dollar bribery. Due to these allegations shares of Adani group’s companies have declined up to 20%. Some investors think this is a good opportunity to buy these shares at a lower price while others are more cautious about the further decline.
After the allegation the officials from Adani did not give any immediate response and that might be the reason for the steep decline but later Adani group gave official statements that these allegations are false and Adani’s CFO also mentioned that these allegations are subject to the projects which consists only 10% of the business.
It will become difficult for Adani group to raise money from the international market till these allegations are proved to be wrong. So in a short term there is a less chance that Adani group’s share will recover to its previous price. Till now US bond investors have largely supported Adani group but now with these allegations it becomes difficult to lure investors.
In the long term if these allegations are proved to be wrong then Adani group’s share will jump again as Adani group operates a large number of ports of not only India but world. Also with the stable government and impressive outlook for India and Adani’s presence in India it will benefit Adani group in the future.