Adani Stocks Drop after Hindenburg Research claims Largest Corporate Fraud in History

Bloomberg:
Shares in $Adeia(ADEA.US)$ companies fell after well-known US activist investor Hindenburg Research LLC said it was shorting the empire’s stocks and accused firms owned by Asia’s richest man of “brazen” market manipulation and accounting fraud.
Billionaire Gautam Adani’s flagship firm Adani Enterprises Ltd. (ADE) and Adani Ports and Special Economic Zone Ltd. dropped as much as 2.5% and 5% respectively on Tuesday after Hindenburg, an US-based investment research firm that specializes in activist short-selling, made wide-ranging allegations of corporate malpractice following a two-year investigation into the tycoon’s companies. Cement makers ACC Ltd. (ACC) and Ambuja Cements Ltd. (ACEM), acquired by Adani recently, also plunged.
Hindenburg’s report details a web of Adani-family controlled offshore shell entities in tax havens, from the Caribbean, Mauritius and the United Arab Emirates, that it claims were used to facilitate corruption, money laundering and taxpayer theft, while siphoning money from the group’s listed companies.
The broadside from Hindenburg comes at a critical time for the ports-to-power tycoon. Adani is seeking to raise his international profile and is aggressively branching into new businesses, including cement and media, in his power base of India, where he is seen to enjoy a close relationship with Prime Minister Narendra Modi. The Adani empire’s expansion plans are closely aligned to the government’s development and economic goals.
Hindenburg said it had taken a short position in Adani’s companies through U.S.-traded bonds and non-Indian-traded derivative instruments. “Even if you ignore the findings of our investigation and take the financials of Adani Group at face value, its 7 key listed companies have 85% downside purely on a fundamental basis owing to sky-high valuations,” Hindenburg said in the report.