When an industrial group achieves spectacular growth, it is seen that those who cannot match the performance of the fast-growing group view such performance with surprise and disbelief. In such circumstances, the armchair critics and the research and investigative organisations would try to “invent and discover” some reasons for the rapid growth of the industrial group and in the process, the research organization would get media attention and come to the limelight. There have also been cases and instances, where the competitors would try to indirectly launch campaigns against the fast-growing group and support negative campaigns so that the interest of the competitors would be protected. There have also been cases where motivated environmental groups have scuttled projects by carrying out hate campaigns and stating unproven environmental violations against particular companies.
There have been many instances to show such motivated campaigns across the world for whatever reasons.
Two instances can be readily pointed out:
One is the Koodankulam nuclear project in Tamil Nadu in India, where a very vicious campaign was made against the project by so-called environmentalists and vested interests, which delayed the project by more than ten years. Now, the Koodankulam nuclear power project is operating quite well after commissioning, which clearly highlights the fact that all the allegations made against the Koodankulam nuclear power project were false and motivated.
Another immediate example is the Sterlite Copper project in Tuticorin region in Tamil Nadu, which is a large copper complex, which has been forced to be closed down by violent agitators, alleging environmental violation. Sterlite Copper management denied all the allegations but the state government decided to close the unit permanently, fearing agitators. The so-called environmentalists said that the Sterlite Copper was causing cancer in the local region and emitting noxious fumes, which was not true. Now, that the Sterlite Copper plant remain closed for around three years, it is clearly seen that there is no change for better in the atmospheric, soil or health conditions in Tuticorin region. This obviously proves that Sterlite Copper was sinned against rather than sinning.
Allegations against Adani group:
The present case of Adani group being accused of financial malpractices etc. by a US based research organization clearly falls on the same pattern as described above.
Many vague allegations have been made against Adani group such as family members occupying crucial posts, some unproven violations and preliminary notices issued against the group by government agencies which were suitably answered, artificially boosting share value in the market and so on.
Multiple activities in vital sector:
Adani group is involved in several field of activities including renewable energy, coal mines, seaport (Adani port), power transmission, telecommunication, airport management etc. All these are well-planned profitable ventures if one can manage the business competently.
Adani group is a significant contributor to the industrial, infrastructure and economic growth of India and it is promoting technology and industrial growth, employment generation and conferring so many other benefits on the country as a whole.
The fact is that all these projects are managed with a reasonable level of competence by the Adani Group. The proof of the pudding is in the eating.
Not a loan defaulter:
While Adani group has taken large loan to finance the projects from financial institutions, there is nothing wrong in this, as these are legitimate methods to start and run any business activity. As the debt is serviced properly as per the terms of the agreement with financial institutions by Adani Group, this clearly show that the business is managed well.
Some sworn critics say that Adani group is debt-ridden. This is not true. As a matter of fact, the total debt of Adani group is much less than several other groups as indicated below
While financial institutions and other agencies have extended loans or the public who have bought equity, there are no complaints from them. This obviously means that they are satisfied with the overall performance of Adani Group and all is well.
There are many ways of raising finances for operating business and so long as they are done as per the law, there should be no complaints.
The allegation that Adani group has artificially boosted the share value in the market is totally baseless, as the market evaluates and reacts to the ground realities relating to the company and participates in the financial scheme of things promoted by the company, as per their judgement.
Is it motivated allegation?
One thing that cannot but be noted is that such allegations have been made by the US based research company against Adani group at a time when the group is launching FPO (follow on public offering). Obviously, one may suspect that the US organization has the intention of sabotaging the efforts of Adani group.
The financing institutions around the world will certainly scrutinize the FPO launched by Adani group carefully and properly and would not be influenced by the findings of some armchair critics, who call themselves as researchers.
Gullible public being misled:
The fact is that when such vague allegations are made and somehow get adequate publicity in the media, gullible people get confused and become suspicious even without understanding the actual facts.
For example, it is ridiculous to see media reports that Adani group’s public offer price is around Rs.3112/- while the face value of the share is Re.1 /- The absurdity of the view can be explained as follows.
“Suppose an organization was founded by the promoters with the face value of the share Re.1/- and when the company would develop and progress very well, then the market share value of this Re.1 /- face value could be much higher. In some cases, it could be even as high as INR 2000 /- and more per share. In such circumstances, when the public offering is done with a share price of around INR 3112/- , it should not be interpreted as that Re.1 face value is being priced as INR 3112 /-
Let not Adani group waste time:
Adani group has said that it was considering legal action against the U S based research company and the research company has replied that it would face legal action.
The fact is that the armchair critical team in USA has really nothing much to lose by legal action and they would get huge publicity due to the protracted legal proceedings that may promote their business contacts.
Whereas Adani group, which has many projects which are under operation oi implementation and have many more future projects in view, would find it difficult to divert its attention and time to fight a legal case in court.
Adani group should ignore such detractors and save its valuable time and energy to move on with the process of contributing to the industrial and economic growth of the country.
Views expressed are the author’s own