Here's a simple breakdown of a complex story:

The reason lies in Adani and his associates using these deals to secure funding from US investors.

Reports estimate the profits from these projects to exceed $2 billion.

Asia’s second-richest man, Gautam Adani, along with his nephew Sagar Adani and Vneet Jain, MD & CEO of Adani Green, have been found guilty of securities and wire fraud.

So, what exactly is this $2 billion case about?

Here's a simple breakdown of a complex story:

1. An Indian energy company, along with a US-based renewable energy issuer operating out of Mauritius, secured contracts to supply significant volumes of solar power to the Solar Energy Corporation of India (SECI).

2. SECI’s responsibility was to distribute this power to state-level electricity boards.

(Solar Energy Corporation of India Ltd. (SECI) is a government entity under the Ministry of New and Renewable Energy, established to drive the National Solar Mission's implementation.)

3. SECI encountered obstacles in securing buyers, resulting in challenges in finalizing power purchase agreements with firms such as the Adani Group and Azure Power.

4. To address this, certain individuals allegedly orchestrated a scheme to bribe officials in Indian state governments to guarantee the purchase of SECI’s power.

5. US prosecutors claim that from 2020 to 2024, over $250 million in bribes were arranged to secure power contracts with the Indian government, with anticipated profits exceeding $2 billion over a span of 20 years.

6. Reports also suggest that Gautam Adani held a meeting with an Indian government official to discuss this alleged bribery scheme.

Since the case is out of the way ,what does an ‘indictment’ mean in the US?

An indictment is a formal written accusation initiated by a prosecutor and approved by a grand jury against an individual charged with a crime.

Being indicted means the accused receives formal notification of the alleged offense, allowing them to hire a defense attorney and prepare their case for legal proceedings.

Source https://t.co/OlfzMwc2kD

What did Adani Group respond in media? The Adani group released a statement later today denying these allegations. Meanwhile, panicked investors rushed for the exit door.

What is the larger impact on Adani group?

These are some pretty serious allegations and could potentially cut them off from the US markets altogether, say experts.

Adani Green had to cancel its $600 million bond issue. This can significantly hamper the Adani Group’s ability to raise capital and expand, which is a big NEGATIVE!

How about GQG partners who bought Adani shares close to 20% stake in Adani Group of companies?

Even GQG Partners, who made a killing “buying the dip” last year, said that they are reviewing their holdings.

Not a good sign!

Globally, there may be a situation and political pressure where the deals might get cancelled. For example, Kenya cancelled proposed deals with Adani Group for energy ministry.

That's a wrap for today's biggest story.

Credit :- 8Sapience