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The Adani Group reportedly bribed officials to approve energy projects, Bloomberg reported, after which the conglomerate dismissed the news as “false.” Now global brokerage firm JP Morgan has weighed in on the issue and said it will not change its view on Adani Group as the extent of corruption is “highly unlikely”.
“Given the high level of transparency involved in several renewable energy tenders held in India, we find it highly unlikely that there is scope for significant corruption and bribery,” JP Morgan’s Love Sharma was quoted as saying by the Economic Times. Considering the details of the report are missing, the brokerage said the investigation cannot lead to a prosecution and that is why it will have limited potential financial/fundamental impact on the Adani Group. She therefore did not modify her recommendation.
“In terms of the provisions of the US Foreign Corrupt Practices Act (FCPA), anti-bribery provisions can result in a fine of $2 million or double the monetary gain, while for individuals could mean up to 5 years in prison and a fine of $250,000. fine or double monetary gain,” JP Morgan said.
JP Morgan’s Love Sharma said: “Within the Adani Group, we continue to favor Adani Ports, where we are overweight across the curve. We highlight that as of November 2023, Adani Ports had received around $553 million as loan for its Colombo Port project from the US government’s development finance arm, DFC. “While this may not imply a ‘clean chit’, it does indicate that some level of diligence is being carried out at the Adani Ports level before the investment is made.”
What did the report say about the Adani Group?
The report states that prosecutors from the US Attorney’s Office and the Department of Justice (DoJ) are investigating an entity of the Adani Group and Azure Power Global over possible bribery investigations. Prosecutors could also be investigating Gautam Adani’s conduct, he said.
What did Adani Group say about the report?
The Adani Group denied the investigations and said it had not received any notification from the US Department of Justice.
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