Dhanji Street in south Mumbai’s Zaveri Bazaar is dotted with jewellery stores and diamond merchants. It was here that the young Gautam Shantilal Adani got his first taste of trading in the 1980s. He sorted stones at a diamond merchant’s place in the mornings, and then went to college. Soon he became so good at the job that he dropped out to become a fulltime diamond trader.
Diamond trading requires quick thinking and swift action. You buy diamonds in one country, trade them in another, cut them in yet another one and then sell the finished stones in a totally different country. This experience has perhaps helped Adani to build an empire that now spans coal mining and power generation to running ports and airports.
As his business expanded, the stocks of his companies became the darling of the market. The group’s flagship, Adani Enterprises, for instance, surged from ₹229.75 on January 24, 2020 to ₹3,434.50 on January 23, 2023—a 1,384 per cent increase. Some of the other group stocks like Adani Ports, Adani Power, Adani Transmission, Adani Green Energy and Adani Total Gas gained between 99 per cent to as much as 2,120 per cent in this period.
Their fall from the peaks was equally spectacular, after a report by US-based short-seller Hindenburg Research sent shockwaves across the markets on January 24. The report accused Adani Group of engaging in “brazen stock manipulation and accounting fraud scheme over the course of decades”, and also pointed to the “substantial debt”, including pledging shares of the inflated stock for loans, putting the entire group on precarious financial footing.
This story is from the February 19, 2023 edition of THE WEEK India.
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This story is from the February 19, 2023 edition of THE WEEK India.
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