Shares of Adani group companies plummeted by up to 20 per cent after US prosecutors in New York indicted Adani Group Chairman Gautam S Adani, his nephew Sagar Adani and six others on Wednesday for allegedly offering Rs 2,029 crore (US $265 million) in bribes to Indian government officials for securing “lucrative solar energy supply contracts” with state electricity distribution companies.
Adani Green Energy plunged by 18.76 per cent, Adani Energy Solutions by 20 per cent, Adani Enterprises by 10 per cent, Adani Power by 13.98 per cent and Adani Ports by 10 per cent in the morning session.
Adani shares dragged the benchmark Sensex by 0.85 per cent, or 655 points, to 76,922.56 and the NSE Nifty fell by 198 points to 23,319.95 on selling pressure at 9.45 am IST.
Dollar bond prices for Adani group companies also fell in Asia trade in the morning session.
A press release issued by the US Attorney’s Office, Eastern District of New York, said quoting US Deputy Assistant Attorney General Lisa H Miller read: “This indictment alleges schemes to pay over $250 million in bribes to Indian government officials, to lie to investors and banks to raise billions of dollars, and to obstruct justice.”
An Adani Group spokesperson said the group would soon issue a statement. Sources in the Adani Group said the charges in the indictment are allegations and the defendants are presumed innocent unless proven guilty.
In a parallel move, the Securities and Exchange Commission Wednesday charged Gautam Adani and Sagar Adani, executives of Adani Green Energy Ltd., and Cyril Cabanes, an executive of Azure Power Global Ltd., with conduct arising out of a massive bribery scheme. SEC filed both the complaints in the US District Court for the Eastern District of New York.
In their indictment, the US prosecutors have anonymised the names of all entities, and some individuals, but noted in the footnote that their identities are known to the Grand Jury. Gautam Adani is named, but is described as the Founder of an Indian Conglomerate, which is a diversified, multinational organisation with corporate offices in India. Sagar Adani (Executive Director of Adani Green Energy) is described as the Executive Director of an “Indian Energy Company” which is a publicly-listed renewable energy company in the Conglomerate’s portfolio. Ranjit Gupta, who was the CEO of Azure Power, and Rupesh Agarwal who was the Chief Strategy and Commercial Officer of Azure Power, are described with the same designations working for an “US Issuer”.
Explaining what it called the “corrupt solar project”, the prosecutors said the “Indian Energy Company” and the “US Issuer” won awards to supply 8 gigawatts and 4 gigawatts of solar power at a fixed rate to state-owned Solar Energy Corporation of India. But since SECI could not find any state electricity distribution companies to purchase this power, it could not enter into corresponding power purchase agreements with Adani Group and Azure Power.
