Adani Enterprises says Ministry of Corporate Affairs probing accounts of its two Mumbai airports

Adani Enterprises Ltd, the flagship arm of Gautam Adani-backed Adani Group, said on Friday that Ministry of Corporate Affairs was investigating the accounts of its two airports in Mumbai.

Adani Enterprises said the ministry had sought information and documents on the airports – Mumbai International Airport Ltd and Navi Mumbai International Airport Ltd – for financial years starting from 2017-18 to 2021-22.

"We would like to inform that Mumbai International Airport Limited and Navi Mumbai International Airport Limited, stepdown subsidiaries of Adani Enterprises Limited have received communications dated October 06, 2023 (received on October 12, 2023) from the Office of the Regional Director, Southeast Region, Hyderabad, Ministry of Corporate Affairs, relating to initiation of investigation of books of accounts," said Adani Enterprises in a stock exchange filing on Friday.

"MIAL and NMIAL shall be responding to the said communications, in accordance with applicable legal provisions," the firm said. On Friday, Adani Enterprises' scrip on BSE closed 2% lower at Rs 2,454.65.

Adani Enterprises owns and operates seven airports, including Mumbai's Chhatrapati Shivaji Maharaj International Airport, which it took over in 2021.

It won six airports as part of the government's first privatisation drive in 2019 and is building a new airport in Navi Mumbai on the outskirts of the city.

The investigation is the latest in a string of troubles for the conglomerate since US short-seller Hindenburg Research earlier this year accused it of improperly using offshore tax havens and stock manipulation.

A probe by markets regulator SEBI into those allegations has "drawn a blank", a Supreme Court-appointed panel said in May.

However, Reuters reported last week that SEBI would tell the apex court why it paused, then restarted investigations into the group after a tip in 2014 amid questions around regulatory delays.

Meanwhile, Financial Times reported on Thursday, citing customs records, that Adani Group imported billions of dollars worth of coal at prices that were sometimes more than double the market price.

Another report by the Organised Crime and Corruption Reporting Project (OCCRP) said Adani family partners used offshore funds to invest in the conglomerate's stocks.

Rajiv Jain, Chairman and Chief Investment Officer (CIO) of GQG Partners, who made multi-billion dollar investment in Adani firms, including Adani Enterprises, post-Hindenburg report, told Australian Financial Review earlier this year that the airport, port and energy assets owned by the Adani companies as “fantastic,” “irreplaceable” and available at a good price.

“About 25 per cent of India’s air traffic passes through their airports and 25 to 40 per cent of India’s cargo volume goes through their ports,” he said.

Speaking to Business Today in August, he said, "We feel that the Adanis’ asset allocation decisions have been remarkably good. If you buy Mumbai airport or any other airport during Covid-19, when it is likely a distressed sale, the transaction has a high probability of doing well."

With inputs from Reuters