Billionaire Rajiv Jain says will double $2 billion Adani group investment in 5 years; yet Adani scrips fall

Billionaire Rajiv Jain says will double $2 billion Adani group investment in 5 years; yet Adani scrips fall

Adani Group stocks fell on Wednesday in an otherwise positive market despite GQG Partners CIO Rajiv Jain making a grand prediction of doubling his nearly $2 billion bet on the embattled Gautam Adani-led conglomerate. “These could be multi-baggers” over five years,” Rajiv Jain said in a TV interview. Adani Enterprises shares fell 1.62%, Adani Green Energy shares tanked 3.32%, Adani Transmission shares tumbled 4.21%, while Adani Ports shares rose marginally on Wednesday.

When asked about why GQG Partners invested in Adani Group companies, Rajiv Jain said that a lot of things happened in the last few years, particularly after Covid Adani Group bought the airport and other assets. “So we started revisiting as actually to see the banking risk we had because of banking exposure and the more work we did, we thought these are fantastic assets at a quite attractive value.”

“If you look at the Adani Enterprises, their main flagship company, bought Mumbai Airport during Covid. So the valuation, the stock went up or 10x in the last two and a half years. Now, if you look at the growth of these businesses have also been tremendous growth and run by a bunch of what you believe is a fantastic entrepreneurs. So those stocks are down 75%-85%. There’s no funding or a refinancing issue for next year and a half. And at current valuations, you can compound that 18%-20%,” Rajiv Jain said.

On the allegation of fraud by Adani Group, the GQG chief said, “So there’s normally one business and there are multiple companies. But the ownership is 75%. If you look at the bulk of the assets, they were spun off from Adani Enterprises. So it looks a little bit unconventional, but if you peel the onion a little bit further, we didn’t find any signs of fraud or anything like that.”

When asked whether the GQG Partners is considering adding to that stake at any point, Rajiv Jain says, “We probably will. In fact, if you look at the opposite set in some of the other companies, not just these, we believe that over time there will be other stuff because India is going to privatise 25 new airports. There’s a massive infrastructure trust coming in like what happened in China twenty-five years ago. So we believe these are the best-positioned entrepreneurs in India on the private side to capitalise on that.”

Hindenburg Research on January 24 accused the Adani family of stock manipulation and fraud and in just a few days Adani group’s market capitalisation fell over 50%. Gautam Adani-led group has refuted the charges and has taken several steps to regain investors’ trust.