Hindenburg report may be blessing in disguise for Gautam Adani, says economist Swaminathan Aiyar

Adani-Hindenburg row: Economist Swaminathan Aiyar has said that the Hindenburg report could be a “blessing in disguise” for Gautam Adani and his business empire as it would bring some financial discipline. In a column in ET, the ace economist said that the Hindenburg report, which saw the combined equity market value of its 10 companies slip below the $100 billion mark, will help the Adani group to slow down from the "breakneck speed" at which it has been expanding and diversifying.

“I think the Hindenburg report may be the best thing that ever happened to Adani. It will slow his speed of expansion and diversification, and force his financiers to be diligent and cautious in the future. This could impose highly desirable financial discipline on Adani, to his own benefit. Hindenburg may have been a blessing in disguise - or, in Winston Churchill's words in response to his wife trying to cheer him up after his post-war electoral defeat, a blessing 'quite effectively disguised,” Aiyar wrote in his column.

He added that though critics have time and again accused Adani of stock manipulation and enjoying political favours, Aiyar highlighted that Adani started off from humble origins to rise to global No. 3 in two decades due to his exceptional business skills.

"Critics accuse BJP of 'giving' Adani valuable assets, from ports and mines to airports and transmission lines. No. What the government initially gave Adani was the right to operate a minor port in the Kutch desert without even a rail connection. To convert this desert patch into India's largest port is close to miraculous. Adani has also acquired jetties and ports in a dozen other locations, beating global giants like Maersk and Dubai World in competitive auctions. He is incomparably India's top port operator, handling an estimated quarter of total Indian freight. This makes him a national champion," Aiyar wrote in his column in ET.

Talking about Haifa Port in Israel and two wind power plants in Sri Lanka, Aiyar said that no Indian rival would dare to take such a risk as Adani had done.

“The Sri Lanka terminal will cost $750 million and Haifa Port $1.18 billion. No Indian rival would dare risk so much even if offered on a platter. Adani's skills have made him a strategic player, more than just a businessman,” Aiyar wrote.

Also read: Adani fiasco: Hindenburg's Nathan Anderson alleges Vinod Adani as key negotiator of deals for the conglomerate

Recently, Israeli ambassador Naor Gilon said the sale of Haifa port as part of Israel’s divestment of state-owned ports was a “landmark” deal and noted that operating ports is the “bread and butter” of Adani Group.

He said Adani Group has “paid in full the cost of Haifa port” and there are adequate funds for further development of the facility.

A consortium led by Adani Group completed the purchase of Haifa port, a major trade and tourism hub on the Mediterranean, for $1.15 billion last month. Standing alongside Israeli Prime Minister Benjamin Netanyahu at a ceremony to mark the completion of the deal, Adani Group chairman Gautam Adani had spoken of further investments in Israel to “transform the entire port landscape”.

Recently, Sri Lanka's Board of Investment approved a $442 million wind power project in favour of the Adani group, which will set up two wind farms in the island's north. The two plants will be supplying power to the national grid by 2025. The Adani group has also signed a $700 million strategic port terminal project in Colombo in 2021.