Adani stock wipeout deepens to $104 billion after flagship firm pulls share sale

The stock rout in Gautam Adani's group of companies intensified Thursday after a sharp selloff forced the Indian conglomerate's flagship firm to pull a record domestic equity offering. 

Adani Enterprises Ltd. tanked as much as 10% in early Mumbai trading, after the company said it abandoned a $2.4 billion follow-on share sale to insulate investors in the offering from potential losses. The other nine stocks in the group also fell. 

Read more: Adani Abruptly Abandons $2.4 Billion Stock Sale as Crisis Mounts

The decision to pull the share offering marks a major setback for Adani, pushing the group's dollar bonds to distressed levels as concerns intensify about its debt risk. The weeklong meltdown has wiped out $104 billion in market value for the group's stocks, as the fallout from US short seller Hindenburg Research's fraud allegations against the conglomerate widens.  

Looking at valuations, "there could be more downside to the Adani group shares," said Nitin Chanduka, an analyst at Bloomberg Intelligence. "Banks could take a knock in case foreign outflows intensify and there is a default on bonds but so far they haven't missed interest payments."

Adani Group has $34.7 million of coupon payments due this week on its dollar bonds, most of which are already at distressed levels. 

Citigroup Inc.'s wealth arm has also joined Credit Suisse Group AG in stopping the acceptance of securities of Adani's group of firms as collateral for margin loans as banks ramp up scrutiny of the Indian tycoon's finances.

With assistance from Abhishek Vishnoi, Matt Turner and Josyana Joshua.