Market Movers: Gautam Adani hits back over FPI shareholding fiasco

MUMBAI: When the world is pointing fingers at you, it does not hurt to point back. Or so the saying goes. Perhaps, Adani Group’s Chairman Gautam Adani intended just that as he lambasted journalists and media for twisting the narrative around foreign portfolio investors in his Group’s companies.

"Recently, a few media houses indulged in reckless and irresponsible reporting related to administrative actions of regulators. This caused unexpected fluctuations in the market prices of Adani stocks," Adani said in his address to shareholders at the virtual annual general meeting of the Group’s companies.

Adani Group stocks have found it hard to recover after they crashed substantially last month in the wake of media reports that the securities depository has temporarily suspended accounts of three FPI shareholders on account of lack of disclosure.

“Unfortunately, small investors were affected by this twisted narrative that some commentators and journalists seemed to imply that companies have regulatory powers over their shareholders to compel disclosures,” Adani said. Media bashing is not the only thing Adani did, of course. Gautam Adani assured investors that the real phase of growth for the group is just beginning.

While Adani’s speech may have provided some food for thought to the media, it did not do much to inspire confidence in shareholders as the group’s stocks ended largely lower. Perhaps, it is foolhardy to assume companies can compel investor confidence, too.

Holding for good days
Shares of holding companies of small finance banks had a field day in the market as they soared following regulatory approval from the Reserve Bank of India that allows for a reverse merger. RBI has communicated to holding companies such as Ujjivan Financial Services and Equitas Holdings that if they want they can now approach the regulator for a reverse merger. If such a reverse merger were to happen then it will significantly lower the holding company discount that weighs on these companies’ stocks.

It is important to note, however, that there are still many hurdles these holding companies need to clear to get to payday. Investors, though, were too happy to care for such hurdles as shares of Ujjivan Financial and Equitas Holdings ended 20 per cent higher each.

Realty is on firing
Perhaps, we are not aware but are residential properties selling like hotcakes? Looking at the performance of real estate stock this month, one would assume that might be the case. The Nifty Realty index soared 3.6 per cent on a day when the rest of the market was on a snooze. The word is that retail investors are piling into real estate stocks like Mumbaikars into local trains before the pandemic. Logic says that investors are discounting strong sales growth ahead as the pandemic’s grip on the country eases again, but wisdom says there is more to this than meets the eye.

Whatever the reason investors seem to be feeling jolly good and so are we about our rest of the evening. So go on, you guys, let us nurse the bruises to our ego given by Mr. Adani.