Shares of Adani Enterprises Ltd. plunged further on Monday, extending a rout that began after the Indian conglomerate threatened legal action against a short seller firm.
The Adani Group, India’s second-largest diversified conglomerate, warned of legal action against Hindenburg Research, a U.S.-based short seller firm that had accused the company of fraud. The Adani Group has denied the allegations and said it will take legal action against the firm.
The Adani Group’s stocks have been on a downward spiral since the announcement, with Adani Enterprises Ltd. falling as much as 11.5% on Monday. The plunge follows a nearly 20% drop in the company’s shares on Friday.
The sell-off has also affected other Adani Group companies, with Adani Green Energy Ltd. and Adani Transmission Ltd. also seeing their shares drop.
The short selling firm, Hindenburg Research, had alleged that the Adani Group had used “dubious” transactions to inflate its profits. The firm also accused the company of making false statements about its operations and financials.
The Adani Group has denied the allegations and said that it will take legal action against the firm. The company also said that it will take steps to protect its shareholders from any “malicious and baseless attacks.”
The sell-off has raised concerns among investors about the future of the Adani Group. The company is set to launch its initial public offering later this year, which could be affected by the current market volatility.
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