GQG’s high-stakes gamble: Can Rajiv Jain weather another Adani storm?

Rajiv Jain-led GQG Partners, listed on Australia’s ASX, saw a sharp recovery on Friday, rebounding 15.5% to an intraday high of AUD 2.46. This came a day after the stock plunged 19.3%, following U.S. bribery charges against Gautam Adani and executives of the Adani Group. The fallout has cast a shadow over the firm, a major investor in Adani companies, and raised questions about its high-stakes investment strategy.

Jain’s GQG Partners was one of the earliest backers of the Adani Group after the Hindenburg Research report in January 2023 accused the conglomerate of financial irregularities. GQG invested an estimated ₹80,000 crore in Adani companies, making significant stakes in Adani Enterprises, Adani Green Energy, and Adani Ports. Jain characterized these moves as strategic, leveraging undervalued assets amid negative sentiment. His investments initially appeared prescient, as Adani stocks rebounded, nearly recouping the $150 billion wiped out by the Hindenburg report.

"We started looking at the group more closely after the report to see what could potentially go wrong and how much impact it would have," Jain had told BT in a 2023 interview. Team members met the Adani leadership during roadshows last year, leading to a reassessment of the conglomerate. "The more work we did, the more bullish we got," Jain said then, highlighting the group's strategic moves into airports, solar modules, and data centres. 

The latest allegations—a $265 million bribery scheme to secure solar power contracts—have reignited scrutiny. GQG issued a statement noting it is “monitoring the charges” and “reviewing emerging details to determine appropriate actions for its portfolios.” While emphasizing that over 90% of client assets are unrelated to Adani, the firm faces mounting pressure from institutional investors to address reputational risks.

GQG’s concentrated investments in Adani companies have been a hallmark of its differentiated strategy. In the September quarter, it increased its stakes in Adani Energy Solutions, Adani Enterprises, and Adani Green Energy. But the unfolding scandal has highlighted the risks of such concentrated exposure, with fears of significant client withdrawals threatening the firm’s $155.6 billion Funds Under Management.

Rajiv Jain, celebrated for his unconventional approach, now faces one of the biggest tests of his career. With GQG’s stock and reputation on the line, the firm must navigate this crisis with the transparency and agility that defined its rise. As Jain once stated, “It is only in being different that we can provide differentiated returns.” That philosophy will now determine whether GQG can weather the storm.