Amidst the storm triggered by the Hindenburg report, the Adani Group has been scrambling to find investors ever since it had to cancel a Rs 20,000 crore fundraising bid. The firm has been conducting a roadshow in Asia as it kept rejecting reports of loans secured from sovereign funds, while the Indian Supreme Court appointed a panel to probe the fiasco. Now Adani has found a saviour in US-based GQG Partners, which was co-founded by star fund manager Rajiv Jain in 2016.
Rising to become a star fund manager
Born and brought up in India, Jain migrated to the US for management studies in 1990 and later went on to join Vontobel Asset Management in 1994. He went on to become co-CEO and chief investment officer at the firm, before launching his own fund GQG Partners with Tim Carver. Since then GQG has invested in secure stocks such as tobacco, oil and banking, without getting tempted by startups and driverless cars.
What's his view on the Adani-Hindenburg fiasco?
Recently, Jain had reiterated his belief in India being a thriving market to invest in, and dismissed the Adani-Hindenburg fiasco as a concern. He added that the Adani crisis isn't the same as Enron or Satyam, and that most of the Group's debt is invested in regulated assets such as the Mumbai Airport and India's busiest ports. These assets are providers of essential services and are an important part of the infrastructure, which makes them low risk.
Many hits and some big misses
But under Rajiv Jain, GQG has also had its troubles with investments that went wrong because of geopolitical headwinds among other factors. For instance the firm which went public in 2021, has seen its stock go down by 20 per cent in 2022. It was the only fund to underperform the benchmark, because GQG had invested 16 per cent of its money in Russia, and couldn't liquidate all holdings by the time war broke out.
The fund where Jain owns 70 per cent of the stakes, also bled value due to the sell off of UK government bonds last year, triggered by spooked investors. GQG lost $12 billion in funds between January to October 2022, because of volatility in the market.
Why Adani though?
Jain's investment in four Adani Group firms, are most likely backed by his view on their regulated assets such as the large number of airports and ports that they control. The firm also has highway projects, although it has decided to stop bidding for more roads for now.
