Investors in Adani Ports had a bit of a bumpy ride as the company's share price went down by more than 3%. The reason behind this was the surprising resignation of their auditor, Deloitte Haskins and Sells. They decided to step down, pointing to some differences in opinions.
The news caused a bit of a stir in the stock market, with Adani Ports' shares going as low as ₹772.95 on the BSE. This unexpected move by the auditor caught many off guard.
To handle this situation, the Adani Group acted quickly. They chose M S K A & Associates, a part of BDO International, as the new auditor for their port business arm, Adani Ports and SEZ Ltd. This decision was made to ensure that proper financial checks and balances are still in place.
Since FY2018, Deloitte Haskins had been responsible for overseeing Adani Ports' financial matters, and they had even received a renewed five-year term only last year. Their sudden decision to resign was because they had concerns about certain transactions mentioned in a report by Hindenburg Research. They also felt that the company wasn't open to an independent review.
In response, Adani Ports explained that Deloitte felt their role and responsibilities were different when compared to their work with other Adani portfolio companies. But the company's audit committee, made up of independent directors, didn't find these reasons strong enough for the resignation.
This news also had an impact on other Adani Group stocks, which saw their prices going down by different percentages, ranging from 2% to 5%. This happened because the entire group is under a bit of pressure due to some allegations made by Hindenburg Research. The Securities & Exchange Board of India (SEBI) is going to give a report to the Supreme Court about these allegations.
Nathan Anderson, who started Hindenburg Research, mentioned the auditor's resignation in a tweet. He said this happened because Adani Ports didn't provide enough evidence to address the issues that were raised in the Hindenburg report.
In response, Adani Group's Chief Financial Officer, Jugeshinder Singh, defended the company's performance. He pointed out that Adani had a 42% growth in EBITDA in the first quarter of FY24 compared to the same quarter last year.
While Adani Ports' share price took a hit, it's important to remember that the situation can change quickly in the stock market. Right now, the share price is around 2.89% lower at ₹777.50 on the BSE. People who are interested in this story are keeping an eye out for more updates.