Adani Group Stocks Retreat After Sharp Rally Triggered by US Bribery Probe Resolution Reports

Adani Group companies witnessed a significant jump in their share prices on Monday, buoyed by reports that representatives of Gautam Adani met with US administration officials.However, this jump was short lived, as on Tuesday, 6th May, the company’s stock are trading at ₹2412.80, declining by 1.74% The reported purpose of these meetings was to seek the dismissal of criminal charges related to a bribery probe. The news triggered widespread buying across the conglomerate's listed entities, leading to a substantial increase in their market capitalisation. 

Key Stock Performances

Adani Group stocks, which surged sharply following a major announcement, have reversed early gains and are now trading in the red as of 10:40 AM. Adani Total Gas, which jumped over 11% on the BSE, is down 2.47% at ₹648.70. Adani Enterprises, after rising nearly 7%, has slipped into negative territory, while Adani Green Energy is down 2.25% at ₹944.05 after a 6.6% rally. Adani Ports and Adani Power, which gained 6.29% and 5.96% respectively, are now down 1.49% and 1.92%. The initial rally has been fully erased across the board.

Context of US Charges

The backdrop to these developments is the bribery probe initiated by US authorities. In November last year, US authorities charged Gautam Adani, his nephew Sagar Adani (Executive Director), and Vneet S Jaain (Managing Director). The charges stem from an alleged scheme to pay bribes to Indian government officials to secure solar energy contracts. It was also alleged that the plan was concealed as the individuals sought to raise funds from US investors.

Adani Group had previously refuted these allegations, stating they were baseless. More recently, Adani Green Energy reported the findings of an independent review into its regulatory compliances concerning the alleged breach that led to the US indictment. The independent review reportedly did not find irregularities or non-compliances on the issue.

The market's positive reaction on Monday appears to be directly linked to the reports of the Adani representatives' engagement with US officials aimed at resolving the criminal charges

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