Just a month ago, at the beginning of the year, mister Indian Gautam Adani he was one of the richest men who ever lived, and by far the richest man in India, and in September nearly ousted Jeff Bezos from the top spot on the list of the richest people in the world. He owned a conglomerate of companies that he created in 1988 as a commodity conglomerate to expand in critical sectors from energy and telecommunications to coal mining, logistics, mining, media and, most recently, green energy. It controls India’s largest port and is the largest airport management and operation company. The group’s value has increased by 2500% in the past five years, while Adani has close ties to the Indian government and is one of the biggest sponsors of Prime Minister Narendra Modi’s party. And the Prime Minister of India never hid his friendship with Adani, who certainly took advantage of it to expand his empire. At its peak, Adani’s stock accounted for over 6% of the value of India’s two major stock exchanges.

However, a few days ago, namely on January 24, the goddess Tychi stopped smiling at Adani. In a few days, his empire lost more than $110 billion, which, as usual, comments The newspaper “New York Times began to dissipate like air through a punctured balloon. Shareholders began to massively sell off his securities, and the sales have not yet stopped. The reason was a report linked to the Adani group by a rather small investment firm, Hindenburg Research, known for short-selling, as they call betting on a falling stock. The company’s report accuses Adani’s group of widespread accounting fraud, long-term stock fraud, money laundering, and many other crimes of a financial nature and beyond. He even called Adani “the biggest fraudster in business history.” And, of course, this caused a chaotic reaction from investors, a sharp drop in the group’s shares and Adani’s fortune, and also affected markets around the world.

The report was released just as the group was promoting a $2.5 billion share sale of its flagship Adani Enterprises, the second-largest equity offering in India. The initial public offering went well, although a massive sell-off had already begun, and Adani appeared pleased next to the Israeli prime minister at a ceremony in the port of Haifa, where his group is carrying out projects. The news spread in the blink of an eye, panic selling continued, and over the next few days, anxious investors called Adani’s financial staff to express their concerns. One of them was the Royal Group, the parent company of Abu Dhabi International Holding Co, which urged Adani’s group to reconsider the share offering. The government financial institution’s decision not to support the group intervened, and Adani called an emergency board meeting. Within 19 hours, the second largest IPO in Indian history went from success to failure.

To defend himself and his group, Adani resorted to his favorite argument “an attack on India, on the independence, integrity and quality of Indian institutions”. And Hindenburg replied that he was trying to cover up his dark deeds under the banner of nationalism, such as, for example, using fake offshore vehicle companies with which he manipulated stock prices. The impact on the Indian market has been huge, with the rupee falling against all Asian currencies and spreads on the country’s benchmark bonds widening to their highest level in four weeks. The investment banks that acted as underwriters for the offering were supposed to pay $12 million, which they lost, however, as their payment was contingent on the success of the offering.

The impact on the Indian market was huge, with the rupee falling against all Asian currencies.

The tremors are being felt even within Narendra Modi’s government due to his ties to Adani, who are now forced to distance themselves from the scam and conduct investigations after heavy pressure from the opposition. The Securities and Exchange Commission of India is also investigating allegations of manipulation of the group’s shares, and the country’s Reserve Bank is looking into the influence of local banks on the fraudulent group. And now it is doubtful that Adani’s businesses will be able to cover the costs, because the unimaginable debt of his businesses is also under attack. According to rating agency Moody’s, the group will no longer be able to raise capital.