Short seller Hindenburg accuses billionaire Gautam Adani of ‘largest con in corporate history’

Gautam Adani, the world’s third richest man, is pulling ‘the biggest scam in corporate history’ through his Indian conglomerate Adani Group, according to scathing allegations published this week by the influential salesman at discovered Hindenburg Research.

Hindenburg – whose previous targets included electric truck makers Nikola and Lordstown Motors – revealed in a research note on Tuesday that he had taken a short position in Adani Group and alleged that Adani’s rise in wealth was fueled by a variety of illegal misdeeds.

“We uncovered evidence of brazen accounting fraud, stock manipulation and money laundering at Adani, which has been going on for decades,” Hindenburg said in the note.

Adani, 60, amassed an estimated fortune of $125.5 billion while overseeing a vast network of companies with stakes in several sectors, including control of major ports and airports, energy, real estate and cement.

Hindenburg Research claims that Gautam Adani pulls “the biggest scam in the company’s history”.
The India Today Group via Getty

On Wednesday, he trailed only French luxury tycoon Bernard Arnault and Tesla CEO Elon Musk in overall wealth, according to Forbes.

“Adani has achieved this gargantuan feat with the help of government facilitators and a cottage industry of international companies that facilitate these activities,” the company added.

The company noted that Adani Group had “previously been the subject of 4 major government fraud investigations”, alleging money laundering, corruption and theft of taxpayers’ money.


Gautam Adani and his wife
Gautam Adani entered the day as the third richest man in the world.
Instagram/Guamada Adani

Hindenburg said he conducted a two-year investigation into the Adani business empire – with research that included dozens of interviews, some with former company executives, as well as an analysis of internal documents and due diligence visits to Company-controlled sites.

The report claims that Adani, several members of his family and other business executives oversee a network of offshore front companies located in tax havens in Mauritius, the United Arab Emirates and the Caribbean.

Hindenberg alleged that some of the fictitious companies appeared to have been hastily cobbled together, with websites “featuring only stock photos, naming no real employees, and listing the same set of nonsensical services.”


gautam adani and his family
Adani, 60, amassed an estimated fortune of $125.5 billion while overseeing a vast network of businesses.

Public stocks affiliated with the Adani Group lost a combined value equivalent to about $12 billion on Wednesday after Hindenburg’s memo was released, according to Bloomberg. However, the value of companies affiliated with the company has increased by more than $50 billion over the past year.

Adani Group’s chief financial officer, Jugeshindar Singh, said the company was “shocked” by Hindenburg’s allegations and strongly denied it.

“The report is a malicious combination of selective misinformation and outdated, baseless and discredited allegations that have been tested and thrown out by India’s highest courts,” Singh said.


Gautam Adani and his family
Adani Group-affiliated public stocks lost a combined value equivalent to about $12 billion.
Instagram/Guamada Adani

“The timing of the report’s release clearly betrays a brazen and mala fide intent to undermine the reputation of the Adani Group,” Singh added.

Hindenburg alleged that many shell companies would be operated by Adani’s older brother Vinod or his “close associates”.

“The Vinod-Adani shells appear to serve multiple functions, including (1) inventory storage/inventory manipulation (2) and money laundering via Adani’s private companies onto the balance sheets of listed companies in order to maintain appearance of financial health and solvency,” Hindenburg said.


Gautam Adani
Hindenburg said he conducted a two-year investigation into the Adani business empire.
AFP via Getty Images

Hindenburg included a list of 88 questions about the company’s operations that “we hope the Adani Group will be happy to answer.”

“Even if you ignore the findings of our investigation and take Adani Group’s financials at face value, its top 7 listed companies are down 85% on a fundamental basis alone due to exorbitant valuations,” Hindenburg said.

The short seller stressed that its report “represents our opinion and investigative commentary” and urged readers to draw their own conclusions about the Adani Group.


Adani Group
Hindenburg alleged that Adani Group engaged in extensive fraud.
SOPA/LightRocket images via Gett

A leading activist investment firm, Hindenburg gained national notoriety after it released a report detailing wrongdoing at electric vehicle company Nikola Corp. in 2020.

Hindenburg said Nikola engaged in “complex fraud”, including an instance in which the company faked a video that appeared to show one of its electric trucks driving down a highway. In reality, the company “just filmed him rolling down the hill.”

Nikola founder Trevor Milton was later convicted of securities fraud after Hindenburg’s allegations sparked an investigation.

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