[Bhokal]

Originally Posted by pganapathy

CAVEAT EMPTOR.

Let the buyer beware. This very old Latin saying expresses it best. Whenever you see any company promise huge returns or their stocks going up exponentially, it is almost always a scam of some kind. I look forward to the day the Adani empire crashes, because it is necessary for people to learn there is no such thing as a free lunch and anything that seems too good to be true probably is.

It is one thing to hold the management responsible for alleged wrong doings but wishing Adani group to crash is abhorrent. Samsung and Hyundai groups (and many other Fortune 500 corporations) have been accused of receiving govt favours and indulging in malpractices but no-one wishes them to crash and burn.

[thanixravindran]

Originally Posted by kiku007

Nationalize this navarathna/national jewel/critical piece of national importance and secure India's future. I mean, LIC and SBI are already invested anyway.

I can understand the sarcasm but don't we already have Asset Reconstruction Companies and NCLAT mechanism to deal with the stressed assets? I know that system is not perfect and lot of promoter meddling going on but even for the sake of argument let us not wish to jump into the fire from frying pan with nationalization, please.

[PreludeSH]

Originally Posted by kiku007

Nationalize this navarathna/national jewel/critical piece of national importance and secure India's future. I mean, LIC and SBI are already invested anyway.

P.S: I can understand that India's infrastructure growth is slow but they've sold the story that infrastructure didn't exist before 2014/Adani. Good PR work.

LIC doesn't even hold 1% and 75% is with promoter for all the companies. Why nationalize ? India will have no issues if the company would wind up. The revenue of all companies combined would be in 20s (billions) ? With lots of debt. Most of the riches we are seeing is on paper.

[Arun Varma]

Originally Posted by JediKnight

Same here. I want Adani to re-emerge stronger. For India's sake. I don't care about Gautam Adani. But I care about India. India needs several companies of Adani's scale. Just a Tata and Ambani are not good enough.

I am sure Mr Adani has done some hanky-panky. But the ground realities of doing business in India are far different from what arm chair experts and self righteous keyboard warriors(like me) understand. I hope his overall intentions are good and he wants to create something of value for the country.

Originally Posted by Bhokal

It is one thing to hold the management responsible for alleged wrong doings but wishing Adani group to crash is abhorrent. Samsung and Hyundai groups (and many other Fortune 500 corporations) have been accused of receiving govt favours and indulging in malpractices but no-one wishes them to crash and burn.

Originally Posted by V.Narayan

All,

But.....the world is only shades of grey....

Businesses like Hindenburg, hedge funds, George Soros trading on the British Pound knowing his actions will cause it to crash {and cause immense harm to a whole society}, lobbying in Washington DC, gun laws, their astronomical pharmaceutical prices etc - the US society has legitimized so much activity which from a strictly human point of view can & does cause immense harm to innocents that some of us today believe that is normal and can say 'he was only following his business model'. It is like saying Adani is also only following his business model of allegedly manipulating his stock price XX times and borrowing against it to grow his business further!!!

Agree 100%

The timing of this (and the BBC documentary), to me, raises suspicion.

I wonder if individuals like us are vying to stay objective and calling a spade a spade while countries like US and UK keep driving their nationalistic agendas. Geopolitical history is rife with instances of US and UK (among other developed countries in the west) indulging in all kinds of nefarious activities to gain any advantage, for things ranging from mere business deals to regime changes, using major (and minor corporations), and news outlets as proxies (under the guise of neutrality and objectivity).

I absolutely want truth and justice to prevail, if not for nothing else but for India to be a destination where it is easy to do business and to remove associations of deep seated and politically enabled corruption.

But are we missing the forest for the trees?

Paint me paranoid!

[sachinayak]

Originally Posted by Arun Varma

The timing of this (and the BBC documentary), to me, raises suspicion.

Again, avoiding politics in my response (hence not referencing the BBC documentary).

The timing may have to do with the Adani Group's FPO. If anyone would want to short a company, and assuming they have enough fuel (and spark) to ignite and sustain a fire, they would do that when the company is seeking public funding to help achieve its "rather aggressive" goals. If the new/reveal has any negative impact of the FPO, it would have longer term consequences and thus resulting in a better return-on-investment of my short positions.

The timing seems to be deliberately intended to hurt the stock prices most (as that is how a short seller would make money).

[warp_10]

Adani Enterprises FPO fully subscribed on Day 3, QIB portion booked 97%
Abu Dhabi's IHC, one of the anchor investors, poured in another $400 million in the FPO

https://www.moneycontrol.com/news/bu...3-9969601.html

Seriously ?? Alas, our belief in power and money restored !!

[GrammarNazi]

Meanwhile, the FPO has been fully subscribed.

This feels like a math problem you solved correctly, but the classroom math wizards are struggling still. So you now doubt what was the complicated part that you missed!



Are the investors living in a parallel universe!? or are they SO sure of OUR future vulnerability? What's the catch!!?

[Theyota]

I guess we will know when the information about background of the institutional buyers and non institutional investors will come out. Clearly retail investors and employees have balked. So either the scam is only growing bigger or most of us are wrong. Gut feeling says it is the former.

[Mad Max]

What surprised me is that whole patriotism and nationalism angle. People are accusing Hindenburg of timing this so that the FPO would get affected. There is quite a lot of detail in the report which Adani companies and it's promotors cannot deny, including the inflation triggers. Their answers have been quite evasive and typical Indian law-based obscure responses.

So, then, what would be the right time to give such a report? When Adani group companies become even more larger and then become even more problematic to the country? I don't see the logic behind these timing questions. Of course, Hindenburg is going to make money but I am quite thankful that this report came out.

There are significant political angles to this which we would not want to discuss here but if they bury this today quoting nationalism, this will just land us in deep dangerous waters in a few years. While I am highly appreciative of what the current government is doing, things like these smell so much alike the previous regime's behavior which this regime loudly proclaimed it would not do. But here we find ourselves with not just one, but a history of such bad practices and unlawful activities happening right under their nose. I can only hope the government acts impartially keeping the citizens in mind rather than the companies involved.

But then politicians just need to change the border color of their veshtis.

[rjainv]

Originally Posted by Mad Max

While I am highly appreciative of what the current government is doing, things like these smell so much alike the previous regime's behavior which this regime loudly proclaimed it would not do. But here we find ourselves with not just one, but a history of such bad practices and unlawful activities happening right under their nose. I can only hope the government acts impartially keeping the citizens in mind rather than the companies involved.

But then politicians just need to change the border color of their veshtis.

Don’t want to make political comment, but there is one universal truth irrespective of who is at power

What skeleton’s are hidden in one’s bed get known only when there is change of guards at the bed post.

[m8002?]

Originally Posted by GrammarNazi

Meanwhile, the FPO has been fully subscribed.



Are the investors living in a parallel universe!? or are they SO sure of OUR future vulnerability? What's the catch!!?

Why are the investors buying at 3200 through the FPO when they can buy for a 10-15% discount in the open market?
We only seem to getting more questions than answers at present.

[Murli]

Originally Posted by m8002?

Why are the investors buying at 3200 through the FPO when they can buy for a 10-15% discount in the open market?
We only seem to getting more questions than answers at present.

The float is not big enough to buy such a huge quantity of shares.

[neeravnaik]

Everything Adani saying maybe true but few numbers to look at for just one of Adani companies Adani Transmission

Market Cap of 200K Crores with a sales of 12K crores and and a profit of less than 1K crores

Somewhat similar company Tata Power

Market Cap of 68K crores with a sales of 51K crores and profit of 3K crores

In addition Adani transmission has a Debt of 33K crores and pays interest of 2.5K crores every year.

Even if firm profits becomes 10X payback period is 20 years at current prices.

This is pretty much story of all group companies. Combine this with fact that none of any Big Indian investor group of any repute invests in Adani and no sensible investor would like to touch these stocks.

Even if Adani is clean a group like Hindenburg will want to short just on the basis on valuations.

Investing is a game of probabilities. There is no certainty but given the facts around Adani valuations and ownership combined with very high levels of debts there are enough red flags to stay away for normal investors.

[pganapathy]

Originally Posted by Bhokal

It is one thing to hold the management responsible for alleged wrong doings but wishing Adani group to crash is abhorrent. Samsung and Hyundai groups (and many other Fortune 500 corporations) have been accused of receiving govt favours and indulging in malpractices but no-one wishes them to crash and burn.

Malpractice or government favours is one thing, but running a ponzi scheme is another. Bernie Madoff ran a 50 billion dollar ponzi scheme. According to what is being said, this is even bigger than that.

[deetee]

Originally Posted by m8002?

Why are the investors buying at 3200 through the FPO when they can buy for a 10-15% discount in the open market?

All those big investors are friends of Adani. They will surely be compensated enough before the ship can sink, otherwise the captain will be made to go down with it. Also, now with all the allegations of fraud, it's matter of prestige and ego for the company if FPO didn't sail through. So they pulled all the strings they can.
Also (this is speculation), this money flow can be for various reasons. For eg, if a big industrialist owes to an influential politician, money can be routed through the company books to make it all white. That's a legal route to recieve big gratitudes.
But, when (not a question of 'if') the ship goes under water, the retail investor will be left to fight for his money. For retail investors, it is very important to not be caught in these chaos.


How this Adani saga will conclude will unfold slowly, maybe over couple of years. Like many mentioned earlier, the company is not going to shut shop nor the stock price is going to zero quickly. However, lets say, some retail investor has purchased stock for Rs.3000 and is holding with expectations of another high (which may never come btw), they may be left to bleed slowly like it happened with many companies earlier.

Originally Posted by Murli

The float is not big enough to buy such a huge quantity of shares.

Today 1.15 crores of stock units have been traded below FPO price. Yesterday it was almost double. If an investor is genuinely interested in the stock, buying large quantities at a discounted price in the open market is not difficult . Motivation behind these investments must be something else.