GQG Partners ups stake in 2 Adani cos to over 5%
New Delhi: US-based boutique investment firm GQG Partners has ramped up its shareholding in two Adani group companies to more than 5 per cent in signs of its confidence in the group despite the damning report of a US short seller.
On June 28, GQG bought $1 billion (Rs 8,265 crore) worth of additional stakes in the group’s flagship Adani Enterprises Ltd and renewable energy firm Adani Green Energy Ltd.
The stake sale in Adani Enterprise was through one block deal, where GQG bought 1.79 crore, or 1.58 per cent, more shares to take its holding to 6.15 crore shares or 5.4 per cent of the total, according to stock exchange filings.
A separate filing showed that billionaire Gautam Adani and his brother Rajesh S Adani had sold the shares of the promoter family. This has reduced the Adani family’s stake in Adani Enterprises to 67.65 per cent from 69.23 per cent previously.
In Adani Green Energy, GQQ bought 4.47 crore or 2.82 per cent additional shares to take its holding to 10.35 crore shares or 6.54 per cent of the total, the filings showed.
The filings did not give the acquisition price, but sources aware of the matter said the investor purchased promoter stakes worth $500 million in each of the two companies.
GQG Partners has been ramping up its investment in the conglomerate ever since Hindenburg Research, in a bombshell report, alleged accounting fraud and stock price manipulation at the group, triggering a stock market rout that had erased about $150 billion in its market value at its lowest point.
Adani Group has denied all allegations by Hindenburg and is plotting a comeback strategy that includes recasting its ambitions, scrapping acquisitions, pre-paying debt to address concerns about its cash flows and borrowings, and scaling back its pace of spending on new projects.
In March, promoters sold stakes worth Rs 15,446 crore ($1.87 billion) in four group companies to GQG Partners. GQG ramped up that investment with an additional purchase of shares worth $400-500 million in May. Prior to the June 28 acquisition, GQG held 4.35 crore shares or 3.82 per cent in Adani Enterprises Ltd and 5.88 crore shares or 3.72 per cent in Adani Green Energy Ltd.
GQG investments have anchored the Adani group’s recovery from the losses sparked by Hindenburg, though all 10 companies are still trading below the levels before the January 24 report.
The sources said the block trade in Adani Enterprises was transacted at Rs 2,300 per share, a premium to its closing price of Rs 2,281.75 on the BSE on June 27. For Adani Green, the trades were priced at Rs 920 to Rs 924.75, a discount to the June 27 closing price of Rs 959.90.
On Friday, Adani Enterprises closed at Rs 2,383.60, while Adani Green ended at Rs 945.60 on the BSE.
Of the $1.87 billion that GQG first invested on March 2, $1 billion was in Adani Enterprises ($640 million) and Adani Green Energy Ltd ($330 million). Later, it also did some open market purchases in the group companies in the following months.
