Key Points:
- Adani Group stocks fell up to 14.54%, wiping out billions in market value
- US seeks to serve summons via email to Gautam Adani and Sagar Adani
- Case involves alleged fraud and $265 million bribery scheme
- India previously rejected two US requests to serve summons
- Charges filed in November 2024 include equity fraud and wire fraud conspiracy
- Adani Group denies allegations as “baseless,” vows legal defense
- Adani Green Energy shares hit hardest, falling to ₹772.80
Adani Group shares plummeted on Friday, with some stocks shedding up to 14.54% of their value, after reports emerged that US authorities sought court permission to serve legal summons directly on billionaire founder Gautam Adani and his nephew Sagar Adani via email in connection with a $265 million bribery and fraud case. The development marks a significant escalation in what is being described as the most high-profile legal action by US authorities against an Indian conglomerate.
The market rout affected virtually every company in the Adani portfolio. Adani Green Energy Limited bore the brunt of the selling pressure, crashing 14.54% to close at ₹772.80, its lowest level in months. Adani Energy Solutions Limited fell 12% to ₹812, while Adani Enterprises Limited, the group’s flagship company, dropped 10.65% to ₹1,864. Adani Ports and Special Economic Zone Limited declined 7% to ₹1,308, and Adani Power shares slipped 5.65% to ₹132.65. The combined market capitalization loss across the group ran into tens of thousands of crores, dealing a severe blow to investor confidence.
US Legal Maneuver Intensifies
According to a Reuters report, US prosecutors have approached a New York court seeking authorization to personally serve summons on Gautam Adani and Sagar Adani through electronic means, after India rejected two previous requests for formal service of process. The case, filed in the US District Court for the Eastern District of New York, centers on allegations of an elaborate fraud and bribery scheme involving $265 million in improper payments.
The legal action dates back to November 2024, when Adani Green Energy disclosed in a stock exchange filing that US Department of Justice (DOJ) and Securities and Exchange Commission (SEC) had filed a criminal indictment and civil complaint against group directors. The charges include three serious counts: alleged equity fraud conspiracy, alleged wire fraud conspiracy, and alleged equity fraud. US authorities also named director Vineet Jain in the criminal indictment, expanding the scope of the investigation into the conglomerate’s top leadership.
The US market regulator argued in its court filing that traditional methods of serving summons have proven ineffective and that direct email service is necessary to move the case forward, citing the global nature of the alleged misconduct and the defendants’ international business operations.
Adani Group’s Denial and Defense Strategy
The Adani Group has vehemently denied the allegations, characterizing them as “completely baseless” and part of a “coordinated campaign to destabilize the group.” In a statement issued to stock exchanges, the conglomerate asserted that it would pursue “all possible legal avenues” to defend itself and its executives. The company has retained top-tier international law firms to mount a robust defense, suggesting a protracted legal battle lies ahead.
Legal experts note that allowing email service of summons in such a high-profile case would be unusual but not unprecedented under US federal rules, particularly when foreign defendants are involved, and traditional diplomatic channels have failed. If the court grants permission, it would compel Adani executives to respond to the charges or riska default judgment.
Market Reaction and Investor Concerns
The sharp selloff reflects deep investor anxiety about the potential implications of a successful US prosecution. Beyond the immediate legal jeopardy facing its top executives, the Adani Group faces risks of asset seizures, restrictions on US dollar transactions, and damage to its global reputation just as it seeks to expand internationally. Several foreign institutional investors reportedly offloaded large positions on Friday, triggering the cascade of selling.
Market analysts warn that volatility in Adani stocks could persist until there is clarity on the legal proceedings. “The market hates uncertainty, and this case introduces a whole new level of risk for one of India’s largest conglomerates,” said a Mumbai-based fund manager who requested anonymity. The rout also raised broader concerns about corporate governance standards and regulatory scrutiny facing Indian business houses with global ambitions.
As trading closed on Friday, all eyes remained on how the Adani Group would navigate this escalating legal crisis and whether it could restore investor confidence in the coming sessions.
