Shares of public sector lenders plummeted by up to 4.50 per cent amid worries over the huge exposure of banks in various Adani Group companies.
The selling pressure in bank stocks came after US prosecutors in New York indicted Adani Group Chairman Gautam Adani, his nephew Sagar Adani and six others for allegedly offering over Rs 2,000 crore (US $265 million) in bribes to Indian government officials for securing “lucrative solar energy supply contracts” with state electricity distribution companies.
Shares of SBI plunged by 3.65 per cent, PNB 4.34 per cent, Bank of Baroda 4.24 per cent, Canara Bank 3.99 per cent and Union Bank 2.25 per cent. Public sector lender IREDA declined by 2.37 per cent, Power Finance Corp 4.46 per cent and REC 4.47 per cent in the morning session.
The Adani group’s total debt exposure is estimated to be around Rs 2.41 lakh crore.
Meanwhile, Adani Green Energy plunged by 17.51 per cent, Adani Energy Solutions by 20 per cent, Adani Enterprises by 21.07 per cent, Adani Power by 12.13 per cent, Adani Total Gas 13.75 per cent and Adani Ports by 19.17 per cent in the morning session.
Adani shares dragged the benchmark Sensex by 518 points to 77,060.29 and the NSE Nifty fell by 182 points to 23,335.80 on selling pressure at 11.30 am IST.
Adani Group also cancelled its $600 million bond offering on Thursday following the US indictment. Dollar bond prices for Adani group companies also fell in Asia trade in the morning session.
According to a statement by the US Attorney’s Office, Eastern District of New York, quoting US Deputy Assistant Attorney General Lisa H Miller, “the 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”.
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.
