Winning Bizness Desk
Mumbai. The stock market faced a significant loss on Thursday as shares of Adani Group companies plummeted following allegations of bribery against the group in a U.S. investigation. The overall market capitalization of listed companies fell by ₹5.28 lakh crore, dropping to ₹425.38 lakh crore from ₹430.66 lakh crore recorded on November 19.
This marks the steepest decline in Adani Group’s shares in 22 months, with the last similar downturn occurring in January 2023 after the Hindenburg Research allegations. The group’s total market value fell by ₹2.19 lakh crore, standing at ₹12 lakh crore. As a result, Gautam Adani, the group’s chairman, saw his personal wealth decline by ₹1.02 lakh crore in a single day, bringing it to $57.7 billion. This represents a sharp 17.34% drop in his net worth, placing him 25th on Forbes’ list of the world’s richest people.
Adani Group Stocks Experience Sharp Declines
Shares of all 10 Adani Group companies saw significant losses, with declines of up to 22.61%. Among these, the sharp drop in stock prices also affected Gautam Adani's brother, Vinod Adani, whose wealth fell by $4.7 billion to $15.4 billion—a 23% decline in just one day. The ripple effect was felt by global investors, too. Shares of GQG Partners, a firm that had previously invested heavily in Adani Group stocks during the Hindenburg crisis, fell by 26% in the Australian market.
Impact on Indian Stock Market
The Bombay Stock Exchange (BSE) Sensex also reflected the turmoil, closing 422.59 points lower at 77,155.79. Despite opening higher at 77,578, the index faced consistent selling pressure throughout the day. During intraday trading, Sensex touched a low of 76,802. Of its 30 major stocks, 20 declined while 10 posted gains. Key gainers included PowerGrid, UltraTech, TCS, and HCL, while NTPC, SBI, ITC, and Asian Paints were among the major losers. Similarly, the National Stock Exchange (NSE) Nifty dropped 168.60 points to close at 23,349.90. Out of its 50 listed stocks, 37 ended in the red, and 13 advanced. The financial services sector declined by 0.53%, while the banking sector fell 0.50%. Among broader indices, Next50 saw a 1.49% drop.
Government Banks Feel the Heat
The fall in Adani shares had a cascading effect on government banks that have provided loans to the group. Shares of State Bank of India (SBI) dropped by 2.64%, Punjab National Bank (PNB) by 4.48%, Canara Bank by 3.32%, and Bank of Baroda by 3.67%. Life Insurance Corporation (LIC), another major lender, saw its shares decline by 1.63%.
Key Highlights
- Adani Group’s shares saw a sharp fall of up to 22.61%.
- Group’s market capitalization reduced by ₹2.19 lakh crore.
- Gautam Adani’s wealth decreased by ₹1.02 lakh crore in one day.
- Sensex dropped 422.59 points, and Nifty fell 168.60 points.
- Government lenders and LIC also witnessed stock declines.
This decline underscores the interconnectedness of Adani Group companies with India’s broader financial system, sparking concerns among investors and policymakers alike.