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How Did Adani Group Bounce-back from the Hindenburg Fiasco? Detailed Business Case Study
On 24th of January, 2023, the Hindenburg report came out with some serious allegations about the market cap of the Adani group companies!! And then we all know what happened!! In just 10 days, the Adani group lost $110 billion in value, Gautam Adani’s fortune went down from $121 billion to $61.3 billion, and the stock market of india was in complete chaos!!! But, you know what? In the next one year, something magical happened and Gautam Adani’s total wealth from $37.7 billion a year back reached $100 billion again. And while most people think that the Hindenburg report harmed the Adani group, when we looked deeper, we realised that this short selling was perhaps a great thing for the Adanis. Today, their cash balance is the highest ever at Rs 45,895 crore which 5.5 billion USD, on top of that, if you look at their 5 year EBITDA it was just growing at a CAGR 26.3%!! But now their portfolio level EBITDA has jumped by 47% you in the first half of FY24, which is their highest ever half year growth in history!! The question is, What exactly changed so drastically After the Hindenburg episode that Adani stocks have started rising again??? What was their business strategy to win the trust of their shareholders? And, lastly, what are the business lessons that we need to learn from the incredible comeback of the Adani group?