Adani’s rollercoaster ride is a costly lesson
MUMBAI, June 15 (Reuters Breakingviews) - Gautam Adani’s rollercoaster ride is an expensive lesson in the cost of clumsy disclosure in frothy markets. Investors knocked as much as $13 billion and up to 25% off shares in five of the Indian tycoon’s Mumbai-listed companies on Monday, including the flagship Adani Enterprises (ADEL.NS) and Adani Ports (APSE.NS).
The crash was triggered by a report noting that some foreign funds which own single-digit stakes of the tightly held companies had been frozen. By the end of the day, it emerged read more that the suspended accounts weren’t actually the ones that held Adani stakes. Adani’s aggressive dismissal of the story undid only part of the damage; the stocks closed $6 billion lighter.
The speed at which the market dumped the shares underscores doubt in a market near record highs. Shares in the tycoon’s companies have risen as much as 1,000% in one year, and some are much more pricey than peers like ReNew Power (RENE.BO) read more , recently acquired by a SPAC. Adani Enterprises itself trades on over 100 times earnings. That leaves no room for error. (By Una Galani)
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