Mutual Fund Houses bought 46 Lakh Shares of Adani Enterprises
Despite the significant setbacks Adani Enterprise is currently facing, mutual funds have upped their stakes in Adani Enterprises. The shares of Adani Enterprises plunged 20% on Thursday after allegations in the United States accused the company and key individuals of involvement in a multibillion-dollar bribery and fraud scheme. Still, the firm ended as one of the top large-cap picks for mutual funds in October.
Mutual Fund Activity in Adani Enterprises
In October, mutual funds collectively added about 46 lakh shares of Adani Enterprises to their portfolio, increasing their holding from 2.5 crore in September to around 2.96 crore, a report states. Notable contributors to the company’s holding included Quant Mutual Fund, which acquired 66.61 lakh shares of Adani Enterprises, and Invesco Mutual Fund, which sold 7.57 lakh shares of the firm.
Activity in Other Adani Group Companies
Accordingly, Sundaram Mutual Fund bought 5.68 lakh shares of Adani Ports and Special Economic Zone (SEZ). On the other hand, Tata Mutual Fund sold 19.99 lakh shares of Adani Power in October. Nippon India Mutual Fund, on the other hand, exited the ACC position by selling 82,224 shares in the same period.
Allegations Against Adani and Associates
The United States Securities and Exchange Commission has indicted the company’s leadership and associates for defrauding investors and paying bribes to officials. It has made allegations of conspiracy to commit securities and wire fraud by misleading investors to raise a huge sum of money from all financial institutions in the United States and other parts of the world.
The indictment alleges that bribes totalling around $265 million were paid out to ensure contracts, which in the long term were supposed to yield a sum of about $2 billion in profit over twenty years. It is further alleged that code names such as “Numero Uno” and “The Big Man” were used to refer to the key individuals involved in the scheme.
It is also charged that the defendants, including top executives of Adani Green Energy, who had admitted committing crimes, hid bribes paid to lenders and investors for securing more than $3 billion worth of loans and bonds.
The allegations have not gone unnoticed by investors, and the shares of Adani Enterprises have plummeted in value. That being said, the fact that mutual funds continue to feature the firm in their large-cap investment list indicates that they do not see it losing ground in the long haul despite this immediate scandal.
This is that delicate dance of performance and litigation that leaves stakeholders to determine what consequences now face the Adani Group for its future.
