By Praveen Menon and Scott Murdoch
SYDNEY (Reuters) -Investment firm GQG Partners Inc founder Rajiv Jain will meet clients and investors in Australia this week and will explain its investment into embattled Indian conglomerate Adani Group, among other things, the company said on Tuesday.
GQG Partners bought shares worth $1.87 billion in four Adani group companies, marking the first major investment in Adani since a short-seller’s critical report in January sparked a stock rout.
The report by U.S based Hindenburg Research alleged stock manipulation and improper use of tax havens by Adani, and flagged concerns over its debt levels. Adani has rejected the allegations and denied any wrongdoing.
The stake purchase has raised queries from an Australian pension fund client of GQG, at a time when major investors, including Norway’s sovereign wealth fund, were selling Adani shares.
Jain is meeting some of GQG’s clients in person while doing conference calls with others, two sources separately told Reuters, declining to be named as they were not allowed to discuss private information.
“Rajiv Jain is visiting Australia this week to meet with investors. The trip was planned well in advance of the Adani purchase,” the statement to Reuters said.
“It’s also an opportunity to respond to any questions they have about the business including the Adani investment,” GQG said, adding it’s Jain’s first visit to Australia since the company listed on the ASX in 2021.
GQG bought 3.4% of Adani Enterprises for about $662 million, 4.1% of Adani Ports and Special Economic Zone for $640 million, 2.5% of Adani Transmission for $230 million and 3.5% of Adani Green Energy for $340 million.
It purchased the stock from the Adani family trust, according to the Indian firms’ filings.
GQG, whose investment was seen by some analysts as a sign of investor confidence in Adani, manages equity funds for institutional investors such as mutual funds, private funds, public agencies and sovereign funds in and outside the U.S.
Morningstar said in a report last month that it expected GQG’s funds under management to grow at a mid-teens CAGR (compound annual growth rate) and exceed $180 billion by 2027, compared to $92 billion as of January 2023.
More than two-thirds of funds under management of the Australia-listed investment firm comes from the Americas, as per its filings. GQG attracted net flows of $3 billion in January and February, more than two-thirds the haul for all of 2022.
(Reporting by Praveen Menon, Scott Murdoch and Lewis Johnson in Sydney; Editing by Sumeet Chatterjee and Muralikumar Anantharaman)
