The Adani Group has recently announced its decision to cancel its plan for a follow-on public offer (FPO) and return the money to investors. The company had previously launched the FPO to raise funds for its subsidiary, Adani Green Energy Limited (AGEL). The FPO was launched on January 18, 2021, with a target to raise INR 50 billion ($680 million) through the sale of new shares.
However, the Adani Group has now decided to call off the FPO and repay the money to investors due to various reasons. Some reports suggest that the company faced a difficult market environment, with limited demand for the FPO shares. Others say that the company faced regulatory hurdles, which made it challenging to proceed with the FPO.
The decision to cancel the FPO has been received positively by the market, with shares of Adani Green Energy Limited (AGEL) rising by 7.5 percent. The company's stock has been performing well in recent times, with the shares increasing by over 80 percent in the past year. The move by the Adani Group to cancel the FPO and return the money to investors is seen as a sign of confidence in the company's financial position and its ability to raise funds in the future.
In conclusion, the Adani Group's decision to cancel the FPO and repay the money to investors has created some buzz in the market. The reasons behind the company's move are still unclear, but it is expected to have a positive impact on the company's financial performance and market reputation.
The shares of several Adani group companies suffered significant losses, with Adani Ports and Special Economic Zone plummeting 19.69%, Adani Total Gas dropping 10%, Adani Green Energy down 5.78%, Adani Wilmar falling 4.99%, and Adani Power declining 4.98%. Additionally, Ambuja Cements declined by 16.56%, ACC went down by 6.34%, and NDTV saw a 4.98% drop.
The overall decline amounts to 38% compared to the market value of the group's companies at the end of trading on January 24th, when the report was released.
Adani Group issued a statement claiming that its financial position is "very healthy with strong cashflows and secure assets." The company stated that the decision to call off the FPO will not affect its operations or future plans and that they will review their capital market strategy when the market stabilizes. Adani Group is working with its Book Running Lead Managers to refund the funds received and release the amounts blocked in investors' bank accounts for the FPO subscription.
As a result of these stock losses, Gautam Adani's ranking on Forbes' rich list has slipped to 15th with an estimated net worth of $75.1 billion, behind rival Mukesh Ambani of Reliance Industries who holds the 9th position with a net worth of $83.7 billion.
