Rajiv Jain-led GQG Partners Inc, one of the biggest investors and backer of Gautam Adani-led Adani Group, may buy back its own shares after they plunged on concern over the fund manager’s exposure to the Indian conglomerate, news agency Bloomberg reported.
As per the report, the US-based investment firm plans to repurchase as much as A$100 million ($65 million) worth of depositary receipts listed in Sydney. Business Today, however, could not independently verify the report at the time of publishing this story.
GQG’s shares dropped 19 per cent on Thursday, after US prosecutors charged billionaire Gautam Adani and some other company executives with helping to drive a $250 million bribery scheme.
Adani Group, in response, termed the allegations as ‘baseless’. “The Spokesperson of Adani Group states that the allegations made by the US Department of Justice and the US Securities and Exchange Commission against directors of Adani Green are baseless and denied,” it stated.
However, Jain-led GQG Partners, listed on Australia’s ASX, saw a sharp recovery on Friday, by rebounding around 16 per cent.
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 Rs 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.
The latest allegations — a $250 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 per cent 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 matter has highlighted the risks of such concentrated exposure, with fears of significant client withdrawals threatening the firm’s $155.6 billion Funds Under Management.
(With inputs from Bloomberg)
