Adani Group FPI Accounts: Frozen? Active? 5-POINT CLARITY EXPLAINER - What really happened? How it all began? Why stocks tumbled? Status right now? Get ALL ANSWERS here

Adani Group FPIs Accounts 'Freeze' Matter: It was Monday i.e. 14th June - a kind fresh day and sort of new beginnings for stock markets as traders, investors, listed companies and concerned professionals generally pin high hopes on Mondays expecting that markets will open on a positive note. But, for Adani Group there was something else in store! Soon after stock markets opened, shares of Adani Group companies started becoming one of top focal points. And, the reason was - stocks Adani Group companies witnessed a massive drubbing in morning trade on Monday! Shares of Adani Group companies tumbled up to 25 per cent. 

But, what was the reason behind such an unprecedented kind of stock mayhem of Adani Group companies? It was a media report claiming that the National Securities Depository Ltd (NSDL) has frozen certain FPIs accounts that have holding in some of Adani Group firms.

Here is the DETAILED 5-POINT CLARITY EXPLAINER citing important information of the entire Adani Group FPIs accounts 'freeze' matter that has become a talking point now, what really happened, what led to this Adani Group firms' stock tumbling and all the possible aspects of the entire mayhem episode:-

POINT #1

-ADANI GROUP COMPANIES: STOCKS TUMBLED! WHY? REASON?

- Shares of Adani Group companies witnessed a massive drubbing in morning trade on Monday, tumbling up to 25 per cent, amid reports that the National Securities Depository Ltd (NSDL) has frozen certain FPIs accounts that have holding in some of these firms.

- Adani Enterprises had tumbled 24.99 per cent to Rs 1,201.10, Adani Ports and Special Economic Zone plummeted 18.75 per cent to Rs 681.50 on the BSE.

- Among others, Adani Green Energy dipped 5 per cent to Rs 1,165.35, Adani Total Gas fell 5 per cent to Rs 1,544.55, Adani Transmission declined 5 per cent to Rs 1,517.25 and Adani Power slumped 4.99 per cent to Rs 140.90.

- All these stocks hit their respective lower circuit limits.

- BIG REASON WAS - According to media reports, the National Securities Depository Ltd has frozen the accounts of three foreign funds which together own shares in four Adani Group companies.

- These accounts were frozen on or before May 31, the report had claimed/added. 

POINT #2

- FPIs (Foreign Portfolio Investors): NAMES OF ACCOUNTS OF THREE FOREIGN FUNDS IN QUESTION?

- Mauritius-based funds 

1-Albula Investment Fund Ltd 

(PAN No. AAHCA3597Q)

2- APMS Investment Fund Ltd 

(PAN No. AAECM5148A)

3- Cresta Fund Ltd

 (PAN No. AADCC2634A)

- These three funds feature among the top 12 investors and owned about 2.1 per cent to 8.91 per cent stakes in five Adani Group companies as of March 31, 2020, annual investor presentations show. 

- The value of their holding in the five Adani group firms was valued at USD 7.78 billion before the stocks witnessed mayhem on Monday. 

POINT #3

- WHAT NSDL WEBSITE HAD SAID vs WHAT ADANI GROUP SOURCE CLAIMS/SAYS?

- The NSDL website had reportedly showed the accounts of Albula Investment Fund, Cresta Fund and APMS Investment Fund as being frozen without citing a reason, as per a report by news agency PTI.

- It listed Albula Investment Fund Ltd (PAN No. AAHCA3597Q), APMS Investment Fund Ltd (PAN No. AAECM5148A) and Cresta Fund Ltd (PAN No. AADCC2634A) as "account level freeze".

WHAT ADANI GROUP SOURCE CLAIMS/SAYS?

- A source at the group, however, said the Registrar has in writing stated that the accounts that hold Adani group stocks have not been frozen, as per a report by news agency PTI.

- NSDL in an email to Adani group said, "the status of demat accounts mentioned in your trail email are held in 'Active' status in NSDL system", as per a report by news agency PTI.

POINT #4 

- CLARIFICATION: WHAT ADANI GROUP HAS TO SAY ON THIS? NOT FROZEN

- Billionaire Gautam Adani's group said it has written confirmation that accounts of three foreign funds that are among its top shareholders are not frozen and reports to the contrary are "blatantly erroneous and misleading".

- Adani Enterprises, the conglomerate's flagship company, as also Adani Ports and Special Economic Zone, Adani Green Energy Ltd, Adani Transmission Ltd, Adani Power and Adani Total Gas Ltd in identical filings to the stock exchanges said the reports of NSDL freezing accounts of Albula Investment Fund, Cresta Fund and APMS Investment Fund holding shares in the group firms were "blatantly erroneous and is done to deliberately mislead the investing community."

- "This is causing irreparable loss of economic value to the investors at large and reputation of the group," they said.

- Given the seriousness of the issue and its consequential adverse impact on minority investors, "we requested Registrar and Transfer Agent, with respect to the status of the Demat Account(s) of the aforesaid funds and have their written confirmation vide its e-mail dated 14th June, 2021, clarifying that the Demat Account(s) in which the aforesaid funds hold the shares of the company are not frozen," the firms said.

POINT #5

-Adani Group FPI Accounts: WHAT IS THE STATUS RIGHT NOW?

Zee Business has learnt:-

- Accounts are ACTIVE

- Accounts are NOT FROZEN

-According to a PTI report, the Demat Account which held Cresta Fund's 10.76 crore shares of the six listed Adani group firms and that of Albula Investment's 8.59 crore shares were 'Active'.

-APMS Investment Fund's account that had 15.52 crore shares of five firms (it did not have had shares of APSEZ) was also 'Active'.

STATEMENT: ADANI GROUP on FPIs

-Later in a statement, the ports-to-energy conglomerate said the FPIs (Foreign Portfolio Investors) in question have been investors in Adani Enterprises Ltd for more than a decade.

-"Demergers (which led to creation of separate firms holding businesses such as power, renewable and city gas) have resulted in the ownership mirroring in the portfolio companies," it said.

-"All our businesses were incubated by the Adani Enterprises Ltd, the flagship company, established in 1994, and during the last seven years Adani Ports, Adani Transmission, Adani Green Energy and Adani Gas Ltd were demerged and listed on Indian Exchanges," the statement said.

-The port business is with Adani Ports & Special Economic Zones Ltd while renewable firm Adani Green Energy Ltd (AGEL) has contracted capacity of 25 GW and is ranked the largest solar power developer in the world. Adani Transmission Ltd operates the largest private transmission network in India of over 17,000 ckm and Adani Total Gas Ltd has license to retail city gas in 38 geographical areas.

- "Adani Enterprises Limited, continues to nurture new businesses such as airports, roads, data centre, solar manufacturing and offers immense value to the investors when these entities get listed separately," the statement said.

- "Adani portfolio continues its journey of exponential growth across all verticals thus ensuring immense value to its stakeholders. We urge all our stakeholders not to be perturbed by market speculations," it said.

CLARIFICATION: MEDIA STATEMENT BY ADANI GROUP:-

"This is to clarify that the FPIs in question have been investors in Adani Enterprises Ltd for more than a decade. Demergers (discussed below) have resulted in the ownership mirroring in the portfolio companies.

Demergers

All our businesses were incubated by the Adani Enterprises Ltd. the flagship company, established in 1994, and during the last seven years Adani Ports, Adani Transmission, Adani Green Energy and Adani Gas Ltd were demerged and listed on Indian Exchanges.

The Adani Group’s focus is the business performances of its listed portfolio

APSEZ

In FY 21 Adani Ports & Special Economic Zones Ltd. handled 247 MMT of cargo, thus registering a CAGR of 3 times higher than industry growth. It has best in class EBITDA margin (70%) and has registered volume CAGR of 10 % during the last five years.

AGEL

In the renewable space, Adani Green Energy Ltd (AGEL) has today contracted capacity of 25 GW and is ranked the largest solar power developer in the world with a best in class EBITDA margin of 89%.

ATL

In the transmission business, Adani Transmission Ltd operates the largest private transmission network in India of over 17,000 ckm with more than 99.9 % availability. Its consumer-facing arm, Adani Electricity Mumbai Ltd., touches more than 3 million homes and 12 million customers in Mumbai.

ATGL

Likewise, Adani Total Gas Ltd., currently has presence across 38 Geographical Areas registering 41% EBITDA which again is the best in the industry. 

AEL

Adani Enterprises Limited, continues to nurture new businesses such as Airports, Roads, Data Centre, Solar manufacturing and offers immense value to the investors when these entities get listed separately. 

Long-term strategic partners

The Adani Group portfolio continues to attract investors and strategic partners both at primary and secondary level.

1 APSEZ: JV partners namely MSC and CMA-CGM at Mundra port

2 AGEL: French energy giant Total Energies both in operational and equity (over $3Bn)

3 ATL: Qatar Investment Authority Qatar's sovereign wealth fund, invested close to USD 430 Mn in   Adani Electricity Mumbai Ltd, a 100% subsidiary of Adani Transmission Ltd.

4ATGL: French energy giant, Total Energies taking 37.4% equity

5AEL: 50% JV with Wilmar Group

Performance of Adani Group portfolio during COVID 19 – A snapshot

FY 2020: EBITDA Rs. 26,400 Cr

FY 2021 EBITDA Rs. 32,300 Cr (Growth of 22%)

Outlook

Based on the current announcements and disclosures, similar growth is expected in March 2022. While Adani Ports has guided for a 11 to 12 % cargo volume growth, AGEL operational capacity will increase by over 5 times from under 2 GW in FY20 to nearly 10 GW in FY22. Similarly, Adani Transmission ltd., will add 2500 ckm and cross 20,000 ckm of transmission assets. This will ensure continued outperformance by Adani listed entities in FY22 and beyond.

Conclusions

Clarification on news article published in the Economic Times – A/cs of 3 FPIs Owning Adani Shares Frozen.https://t.co/IFiqd6xj9L

— Adani Group (@AdaniOnline) June 14, 2021

Adani portfolio continues its journey of exponential growth across all verticals thus ensuring immense value to its stakeholders. We urge all our stakeholders not to be perturbed by market speculations. "