MUMBAI: Shares in the flagship firm of troubled Indian conglomerate Adani rose almost 15 per cent Tuesday, clawing back some of its recent huge losses after saying it would repay more than $1 billion in loans.

Investors wiped out around $120 billion in value from the group owned by tycoon Gautam Adani after claims of accounting fraud by short-seller US investment group Hindenburg Research on January 24. The collapse raised concerns about the group’s ability to raise fresh financing to pay down its debts. It cancelled a share sale, and reportedly also a bond issue, last week.

But India’s biggest conglomerate said on Monday it was repaying early loans worth $1.1 billion, in a move meant to reassure investors. The Adani Ports subsidiary said on Tuesday it would also repay debts of around $605 million and slash by half its capital expenditure in the next financial year.

Adani Enterprises, the group’s flagship firm, soared as much as 25pc on Tuesday, with trading suspended three times on the way up. The shares closed up 14.6pc — although they are still down by more than half since the start of the year.

Other group companies were mixed, with Adani Transmission rising five per cent but closing 0.77pc lower, and Adani Total Gas down five per cent and trade suspended again.

Fitch Ratings said on Tuesday that Indian banks’ exposure to the Adani group was “insufficient in itself to present substantial risk to the banks’ standalone credit profile”.Hindenburg accused Adani of a “brazen stock manipulation and accounting fraud scheme” in “the largest con in corporate history”.

Published in Dawn, February 8th, 2023