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On February 4, market regulator SEBI noted that shares of Adani Group, a troubled conglomerate, were experiencing unusual price movements.

The regulator said that in all specific matters related to the entity, if any information comes to SEBI’s knowledge, it will be examined, and take appropriate measures.

The Securities and Exchange Board of India (SEBI) has said that it will ensure the integrity of the market and good structural soundness in the event of potential manipulation of the market price of Adani Group shares. Sebi’s statement comes shortly behind the Reserve Bank of India (RBI) report on the Adani Group crisis.

“Over the past week, we have noticed unusual price movements in the shares of a trading group,” SEBI said in a statement. He said his monitoring wing under the market regulation department is looking into the matter. It added: “Further investigation is underway.”

SEBI’s mandate is to maintain an orderly and efficient market, and it has established a set of well-defined monitoring measures to address excessive volatility in specific stocks. By sharing these metrics with the public, SEBI hopes to establish a more open marketplace that works better for everyone involved.

On February 2, the National Stock Exchange (NSE) placed three securities, namely Adani Enterprises, Adani Ports, and Ambuja Cements, under the framework of Additional Monitoring Measures (ASM) with effect from February 3, 2023.

Adani Companies share prices rose sharply on Friday ahead of its board meeting, which is expected to see a key decision on the company’s move to sell a stake in its flagship coal mining unit to the giant. Glencore miner for $2.5 billion. The Adani Group board has not yet approved the transaction of directors. Adani Enterprises shares were trading higher at Rs. 202.30 on BSE, while Adani Ports and SEZ were trading around Rs. 544.45.

The Adani group had run into trouble after a research report by US short-seller Hindenburg alleged gaps in the group’s finances, a high debt load, and risk of overvaluation. This led to a sharp drop in the share prices of Adani group companies.

Adani Group’s proposed Rs 20,000 crore follow-up share sale has been called off due to a sharp drop in the company’s share price. This is yet another blow to the group already in financial trouble.

Subsequently, concerns rise as reports suggest that several large Indian banks have fund-based and non-fund-based exposure to the group, which CLSA reports estimate at 38 percent of the company’s total exposure. If the company goes bankrupt, these big banks will leave with huge debt.

Thirty-seven percent comes from bonds/commercial paper, 11 percent from financial institution loans, and the remaining 12-13 percent from intragroup loans, leaving little room for other funding sources, according to the report.

The Reserve Bank of India (RBI) issued a statement shortly after the country’s largest lender, the State Bank of India (SBI), dismissed concerns over its Rs 27 billion exposure to the Adani group. SBI said this exposure is less than 0.9% of its loan book and is not a cause for concern.

“Based on the Reserve Bank’s current assessment, the banking sector remains resilient and stable,” the RBI said in a statement released on the evening of February 3. Typically, the RBI issues statements of this type to appease stakeholders when fears of a potential liquidity crunch after certain events hit the banking system.

RBI mentioned that it monitors the risk profile of a particular business group in the Indian banking sector concerning the Adani group.

The central bank did not name the group or business group but said the RBI “will continue to provide a cautious and appropriate response to emerging risks in the banking sector.”

Scarlet Samson

After its flagship company abandoned a $2.5 billion share sale on Wednesday, Adani Group’s market losses reached $100 billion on Thursday, sparking worries about a possible systemic impact.

The return to sales of Adani Enterprises (ADEL.NS) shares marks a dramatic coup for founder Gautam Adani, the school dropout-turned-billionaire whose fortunes have risen sharply in recent years. Still, US Hindenburg posted an important research report.

The billionaire’s decision to cancel the share sale hit markets, politics and business. Adani’s shares tumbled, opposition lawmakers called for a broader investigation, and the central bank launched an investigation into banks’ risk aversion.

Meanwhile, Citigroup’s (C.N.) wealth unit stopped making margin loans to its clients against Adani Group securities.

Adani has partnered with foreign giants such as France’s Total Energy (TTEF.PA) and has attracted investors such as Abu Dhabi’s International Holding Co in its pursuit of global expansion from ports to the energy sector.

In a surprise move on Wednesday night, Adani called off the share sale as criticism of Hindenburg accelerated the share’s slide, even though he fully subscribed the day before.

“Adani may have triggered a confidence crisis in Indian stocks, and this could have broader market implications,” said Ipek Ozkaredskaya, senior market analyst at Swissquote Bank.

Adani Enterprises‘ stock dropped 27% on Thursday, closing at its lowest price since March 2022.

Other group companies also lost more ground, with Adani Total Gas (ADAG.NS), Adani Green Energy (ADNA.NS) and Adani Transmission (ADAI.NS) losing 10% each, while Adani Ports & Special Economic Zone (APSE.NS) ) ) lost almost 7%.

Since the Hindenburg report on January 24, the group’s companies have lost almost half their combined market value. Adani Enterprises, described as an incubator for Adani’s businesses, has lost $26 billion in market capitalization.

Adani is no longer even the richest man in Asia after falling to 16th in Forbes’ ranking of the world’s richest people; his net worth nearly halved to $64.6 billion in a week.

The 60-year-old was third on the list after billionaire Elon Musk and Bernard Arnault.

His rival Mukesh Ambani of Reliance Industries (RELI.NS) is now the richest man in Asia.

Overall situations

The fall in Adani stock and bond prices has raised concerns about the potential for broader ramifications for India’s financial system.

On Thursday, government and banking sources told Reuters that India’s central bank had asked local banks for facts about their exposure to the Adani group.

CLSA estimates that about 40% of the Adani Group’s $24.5 billion credit exposure is with Indian banks in the fiscal year to March 2022.

Dollar bonds issued by Adani group entities extended losses on Thursday, and Adani Green Energy Ltd (ADNA.NS) notes fell to a record low.

In New Delhi, opposition M.P.s have filed legislative notices demanding a discussion on the short sellers report.

The Congress party demanded an investigation under the supervision of a Parliamentary Joint Committee or the Supreme Court.

Adani VS Hindenburg

Adani will see acquisitions worth $13.8 billion in 2022; the DeLogic data showed an all-time high and more than double the year ago.

The cancelled fundraiser was significant for Adani, which said it would use $1.33 billion to finance green hydrogen projects, greenfield airport facilities and highways, and $508 million to pay down debt on some units. Will do

The Hindenburg report alleged abuse of offshore tax havens and stock manipulation by the Adani group. He also raised concerns about the high debt and valuation of Adani’s seven publicly traded companies.

The Adani Group has denied the allegations, stating that the allegation of stock manipulation was «baseless» and stemmed from ignorance of Indian law. Adani managed to get a sale subscription for the shares on Tuesday, even though the market price of the shares was lower than the offer price of the issue.

Late Wednesday, the group’s founder said he would withdraw the sale given the falling share price, adding that his board felt it would be “not ethically correct” to proceed.

Scarlet Samson

India faces an innovative and exciting future. India can boost its GDP from $3 trillion to $9 trillion by 2030 and $40 trillion by 2047 if it can use its demographic dividend to generate good jobs.

It’s a ‘yes’ but not impossible. In a fast-growing world, India is still young, opening up an extraordinary opportunity. According to the United Nations Population Statistics Database, India will add another 183 million people in the working age group (15-64 years of age) between 2020 and 2050. When we do the calculation, we find that a whopping 22 per cent of the growing global workforce will come from India over the next 30 years.

The Indian job market is at an inflexion point: of possibilities.

Despite high economic growth (CAGR of 7%) and employment growth (CAGR of 5%) between 2004 and 2018, the Indian labour market has struggled to reach its full potential for decades. The post-pandemic recovery of the labour market has been uneven across industries and geographical areas. There has been an upsurge in employment and self-employment among small traders, day labourers, and farmers, even though the recovery of wage jobs has been gradual.

This fact doesn’t, however, cloud our promising future in any way. We can give our children enormous chances and take advantage of the rising worldwide demand for technological skills if we have the right policies to create future-proof jobs and investments to build physical and digital infrastructure.

Extraordinary occasions call for extraordinary efforts.

With the 2023 Union Budget just around the corner, all eyes are on how it can pave the way for the product creation of the country’s abundant human capital.

Like Martin Luther King Jr., I, too, have a dream: a country of broad and equal opportunity for all, where everyone has a fair chance to lead a value-oriented and purposeful life. In this context, starting with the staffing industry, I have specific recommendations ahead of the Union budget for 2023.

1. Focus on job creation opportunities

Government initiatives (PLI scheme, Make in India, Atmanirbhar Bharat etc.) have certainly given momentum. However, the budget must keep pace with creating new job opportunities in all sectors.

2. Promoting better training initiatives for youth

In a situation where nearly 75% of companies report a skills gap, only 48.7% of India’s youth are employable, according to the India Skills Report 2022. If we want to give the young people of India genuine job prospects, closing this skills gap has never been more important. We anticipate that the budget will contribute more to ongoing projects (Skill India, Country Stack web portal, digital universities, etc.).

3. Industry Conditions for Staffing

The staffing industry plays an important role in opening up employment opportunities for the commoner (in general) and promoting economic growth. It also provides value-added services to businesses by helping to manage technology, skills, and other requirements. It should be given industry status.

4. Enforce labour codes with clear deadlines.

This is crucial, and it would be helpful if the federal and state governments established help desks early on to speed up adoption. My wish list also includes the following particular suggestions:

• Make appropriate amendments to the Income Tax Law that raise awareness about issuing orders within agreed time limits, especially given the commendable levels of digitization and automation achieved.
• Enable efficient reporting mechanisms and tools for 26AS, where data is voluminous, to enable transparent and accurate matching with Ledger.
• Reduce employee PF contribution to 5 per cent (from the existing 12 per cent) to provide more disposable income and fair opportunity for professionals to invest their money in other avenues.
• For The Turmoil Of The First Few Years Of GST Implementation, A Special GST Reforms Window Has Been Created.
• For major service providers, centralized GST registration will speed up and simplify compliance, reimbursement, assessment, audit, etc.
• In a world where people switch employment almost every two to three years, abolishing tipping is pointless.
• To encourage the service sector, extend the Service Exports from India Scheme (SEIS) to the fiscal years 2020–21 and 2021–22.
• Permanent stay under the IT Act on delayed regulatory despatch for Personnel Service Providers, given their undue dependence on Primary Employers

With India poised to become the most populous country with an extreme demographic dividend, it is now or never.

Scarlet Samson

The Union Budget, which describes the government’s plans for spending and collecting money for the upcoming fiscal year, is a crucial document. It significantly impacts economic policies and directly impacts people’s lives, particularly young people.

The series interviews students and young working professionals and tries to understand the reasons behind the lack of interest among today’s youth in the budget announcements and their expectations.

Himanshu Arora of Shaheed Bhagat Singh College, University of Delhi, stated in an interview that he thinks the choices made in the Union Budget can serve as a guide for future generations of young people and Generation Z to budget their money for specific objectives rather than just splurging. can aid in doing. What they can afford, and what is required. He is a passionate 21-year-old student who enjoys reading and regularly contributes to conversations on business, technology, and education.

How are the youth and Generation Z affected by the decisions made in the Union Budget? Why is it crucial that they participate and actively engage in it?

The decisions taken in the Union Budget can be a roadmap that can help youth and GenZ plan their finances for specific goals and spend only what is necessary and what they can afford. Budgetary choices will eventually be crucial in helping them achieve a better and more secure financial future.

The population of recently added and upcoming taxpayers anticipates Nirmala Sitharaman, the finance minister, to concentrate on increasing capital investment to give them enough educational facilities and employment possibilities. A hike in the standard deduction, tax relief for the gig economy, and increasing benefits on education loans are some of the things on GenZ’s wish list in the country, especially given the playoffs and pay cuts in the post-pandemic era.

The tax filing process requires technical knowledge from taxpayers or non-finance grads despite being digitalized.

For various reasons, today’s youth needs to engage and learn about financial literacy, including the rising cost of higher education and the more complex nature of the global economy. Gaining vast knowledge from budgeting will help in managing finance and money.

What do today’s youth seek from the government and its spending choices? Why are they still waiting?

Youth is the backbone of any society. When nurtured, youth can grow like a giant tree but erupt like a volcano if budgetary decisions do not provide the relief needed to prepare or care for them. The youth have high expectations from the government and its budgetary decisions. They soon anticipate that relief efforts will address issues relating to their mental health, educational opportunities, and economic prospects:

Education: Aspiring youth expect a better quality education through revamped institutions, focusing more on research-based training, which ultimately imparts employable skills. The world is still recovering from the critical phase of COVID-19. Nevertheless, India must take necessary steps to bridge the growing digital divide between marginalized sections of the population and those belonging to higher-income groups.

Employment: Employment remains a major concern for the youth of India. Many youths have lost their jobs during the pandemic, and there is no guarantee that youths who are new to this field will get jobs soon. The informal sector’s sources of income are also dwindling.

Entrepreneurship: Programs like Start-up India and Make in India must put more emphasis on employment creators than job seekers.

Physical and Mental Health: The youth are hopeful that the Union Budget should focus on the physical and mental health status of the youth. They should comprehensively address these problems and prepare suitable programs to improve the health status of the youth.

In Short, young people are faced with a problem and an opportunity to increase their employability to lead better lives due to the rapid economic change and the future work landscape. Young people can benefit from economic growth by increasing their employability and providing job security and career advancement.

Scarlet Samson

India’s largest life insurer is pouring more money into Gautam Adani’s flagship unit, undeterred by allegations of a short sale fraud that wiped more than $50bn off the group’s market value in two sessions.

According to a document, Life Insurance Corporation of India is spending around Rs 3 billion ($37 million) as a lead investor in a new $2.5 billion share sale of Adani Enterprises Ltd. The investment will be added to the current share of 4.23. ,

With its investment on January 25, LIC showed its support for Asia’s richest man and his troubled company, which was facing its hardest test yet in the wake of US-based Hindenburg Research. LIC is one of 33 institutional investor anchors in the FPO, along with companies including Al Mehwar Commercial Investments LLC and the Abu Dhabi Investment Authority.

While Mumbai-based LIC’s investment is relatively small, with LIC having around Rs 43 trillion in assets under management, it starkly contrasts with other domestic financial institutions to which Adani has little to no exposure. This also affected shares exposed to the Adani group, including LIC, which fell the most in over a month in Mumbai on Friday.

Arun Kejriwal, the founder of Kejriwal Research and Investments, said: “LIC thinks otherwise.” “You had always made money when the market was volatile. The money is not available for a short time. It acts as a long-term fund.

Emails and texts sent to the LIC president seeking comment on the Adani group’s investment were not immediately returned.

LIC is one of India’s most systemically significant institutions, with more than 250 million policyholders and assets under management that rival the size of the nation’s mutual fund sector. Exposure to the Adani group, whose development objectives are well known to be closely matched with those of Prime Minister Narendra Modi, is another indication of the tycoon’s political weight.

A stake in five Adani companies owned by LIC ranges from 1% to 9%. There are no other Indian insurance companies that have a sizable interest, according to the December 2022 data that was posted on the stock exchanges. Although certain stocks have had significant gains, most mutual funds have avoided this group. For instance, Adani Enterprises has increased by more than 1,900% over the last five years, outpacing even Elon Musk’s Tesla Inc.

According to Jairam Ramesh, a politician with the opposition Indian National Congress party, the significant exposure of state-backed financial institutions “has repercussions for financial resilience” and for the millions of Indians “whose funds are stewarded by these pillars of the financial system.”

Such worries might gain more traction due to the selloff sparked by Hindenburg’s report. On Thursday, the downturn worsened as some stocks, including Adani Green Energy Ltd. and Adani Total Gas Ltd., fell over their 20% daily limit. Adani Enterprises decreased by 19%.

The short seller claims that Adani Group engaged in “brazen” accounting fraud and market manipulation, employed offshore shell businesses for money laundering, and stole from publicly traded companies. According to the company, the report is “a nasty blend of selected falsehoods and outdated, unsubstantiated, and debunked charges.” It said that legal action is also being considered.

Jugeshinder Singh, the chief financial officer (CFO) of the Adani Group, admitted the lack of enthusiasm among domestic institutional investors last week.

At a press conference, he stated, “We recognise mutual funds missed the Adani growth stock boom.” “We ought to have informed the mutual funds.”

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Scarlet Samson

Hindenburg Research said India’s Adani Group accuse of misusing offshore tax havens and pointed to concerns over high debt, which eroded $11 billion in investors’ wealth on Wednesday.

The group, led by Gautam Adani, the world’s third-richest man according to Forbes, dismissed the claims of US short sellers as baseless and said it’s programmed to damage their reputations ahead of the massive stock offering.

The group’s flagship firm, Adani Enterprises (ADEL.NS), will launch the country’s biggest secondary public offering of shares on January 27 to raise $2.5 billion to finance capital expenditure and pay down part of the debt.

Hindenburg, known for shorting electric truck maker Nikola Corp (NKLA.O) and Twitter, said he hedges Adani companies through US-traded bonds and non-Indian-traded derivatives.

His scathing investigative report questioned how the Adani group had used offshore entities in offshore tax havens such as Mauritius and the Caribbean Islands, adding that some offshore funds and shell companies linked to the Adani group “secretly hold shares in Adani-listed companies.

Additionally, it claimed that Adani’s biggest publicly traded companies were “much in debt,” placing the entire group on “precarious financial footing.” At what he dubbed “sky-high values,” he asserted that shares of seven Adani-listed firms are down 85% on a fundamental basis.
Adani Group CFO Jugeshinder Singh said the report shocked the company, calling it a “malicious combination of targeted misinformation and old, baseless and discredited allegations”.

“The group has always followed all laws,” the company said without addressing Hindenburg’s allegations.

It added, “The timing of the report’s publication reveals a brazen and evil intention to malign the reputation of the Adani Group with the primary objective of damaging the upcoming follow-on public offering of Adani Enterprises.”

Shares of Adani Transmission (ADAI.NS) fell 9%, Adani Ports and Special Economic Zone (APSE.NS) down 6.3%, and Adani Enterprises fell 1.5%. The seven publicly traded group companies collectively lost $10.73 billion in market capitalization.

In bond markets, US dollar-denominated bonds issued by Adani Green Energy (ADNA.NS) fell nearly 15 cents to less than 80 cents on the dollar, according to Tradeweb data. In contrast, international bonds issued by Adani Ports and Special Economic Zone, Adani Transmission and Adani Electricity Mumbai saw similar declines.

The report coincides with an offer for a secondary sale of Adani shares by key investors on Wednesday, with the company registering Maybank Securities and Abu Dhabi Investment Authority participation on the stock exchange.

According to Hindenburg, the investigative studies were based on a two-year inquiry involving document review and interviews with numerous people, including former Adani Group executives and many others.

In response to a request for comment, the Securities and Exchange Board of India (SEBI), which regulates India’s capital markets, was silent.

Adani has frequently rejected concerns regarding the debt. On January 21, Singh spoke to the press: “No one has voiced any reservations about the loan. Investors have not.”

The Hindenburg report noted that five of Adani’s seven major publicly traded companies had reported short-term liabilities with a current ratio, minus liquid assets, below 1. The short seller said this “suggests greater short-term liquidity risk”.

The overall gross debt of the Adani Group rose by 40% to Rs 2.2 lakh crore in the fiscal year that ends March 31, 2022.

Debt exceeds equity in seven of Adani Group’s major Adani companies, and debt in Adani Green Energy Ltd (ADNA.NS) exceeds equity by more than 2,000%, Refinitiv data shows.

CreditSights, part of Fitch Group, described the group as “overleveraged” last September. While the report later corrected some miscalculations, CreditSites said it’s concerned about the leverage of the Adani group.

Hindenburg also said he’s concerned that a substantial portion of the capital held by promoters or major shareholders of Adani Group-listed companies committed to debt.

According to the research, “Equity share promises are an inherently insecure source of loan collateral.”

The Adani Group acquired cement manufacturers ACC (ACC.NS) and Ambuja Cements (ABUJ.NS) from Swiss company Holcim (HOLN.S) for $10.5 billion last year. Days later, it entered into a non-disposal agreement with banks, pledging shares in the two companies—worth approximately $12.5 billion at the time—to prohibit selling the shares before lenders approved the repayment of the debt.

Scarlet Samson