AEL shares tank over 26% group firms follow

Press Trust of India

New Delhi: Shares of Adani Enterprises tumbled over 26 percent on Thursday, a day after the firm said it has decided not to go ahead with its Rs 20,000-crore Follow-on Public Offer (FPO) and will return the proceeds to investors.

The stock tanked 26.50 percent to settle at Rs 1,564.70 on the BSE. During the day, it tumbled 28.88 percent to Rs 1,513.90 -- its 52-week low. Most of the other group firms also declined for the sixth day in a row. The 10 listed Adani Group firms have faced a combined erosion of over Rs 8.76 lakh crore in 6 days.

Shares of Adani Transmission fell 10 percent on Thursday, Adani Green Energy tanked 10 percent, Adani Total Gas 10 percent, Adani Ports 6.13 percent, Adani Wilmar 5 percent, NDTV 4.99 percent and Adani Power lost 4.98 percent. Many of the group firms also hit their lower circuit limits during the morning trade. However, shares of Ambuja Cements jumped 5.33 percent and ACC inched up 0.05 percent.

Adani Group stocks have taken a beating on the bourses after US-based Hindenburg Research made a litany of allegations in a report, including fraudulent transactions and share price manipulation at the Gautam Adani-led group. Adani Group has dismissed the charges as lies, saying it complies with all laws and disclosure requirements.

“The Board of Adani Enterprises Ltd., (AEL) decided not to go ahead with the fully subscribed FPO. Given the unprecedented situation and the current market volatility, the company aims to protect the interest of its investing community by returning the FPO proceeds and withdrawing the completed transaction,” the company said in a statement late on Wednesday. As many as 4.62 crore shares were sought as against an offer of 4.55 crore.

Non-institutional investors put in bids for over three times the 96.16 lakh shares reserved for them, while the 1.28 crore shares reserved for qualified institutional buyers (QIBs) were almost fully subscribed, according to BSE data. There was, however, a muted response from retail investors and company employees.

Retail investors, for whom roughly half of the issue was reserved, bid for just 11 percent of the 2.29 crore shares earmarked for them. Employees sought 52 percent of the 1.6 lakh shares reserved for them. Adani Enterprises, the flagship company of the Adani Group, had a lacklustre start to its FPO subscription.