Hindenburg Research claimed Adani Group had committed ‘brazen’ corporate fraud but Adani Group dismissed the report.

Seven listed companies of the Adani conglomerate lost a combined $48bn in market capitalisation after Hindenburg Research flagged concerns in a January 24 report about debt levels and the use of tax havens.

Adani who was the world’s third-richest person at the start of the week is now ranked number seven on Forbes’ billionaires tracker after a $22.6bn hit to his fortune in Friday’s trade.

Adani Enterprises, the group’s flagship company, plunged nearly 20 percent over the day’s trading in Mumbai, briefly triggering an automatic trading halt, before recovering slightly to close 18.52 percent lower.

Five other group companies hit their own stock exchange circuit breakers, with shares in Adani Total Gas, Adani Green Energy and Adani Transmission falling 20 percent apiece.

“Obviously, this is panic-selling,” JM Financials equity research chief Ashish Chaturmohta told AFP, adding that traders were creating new short-sell positions to protect earlier bullish bets on Adani stocks.

Hindenburg Research said in its report that Adani Group had used undisclosed related-party transactions and earnings manipulation to “maintain the appearance of financial health and solvency” of its listed business units.

Adani Group dismissed the report as baseless and that it was the victim of a “maliciously mischievous” reputational attack by Hindenburg.

Legal chief Jatin Jalundhwala said Adani was exploring considering taking legal action against the New York-based research advisory in US and Indian courts.

Hindenburg responded that Adani had ducked the issues its research had raised and instead resorted to “bluster and threats”.

“If Adani is serious, it should also file suit in the US,” the firm said in a statement. “We have a long list of documents we would demand in a legal discovery process.”

Adani, with a net worth of $96.6bn, is considered a close supporter of Prime Minister Narendra Modi. India’s main opposition Congress party has often accused Adani, and other billionaires, of getting favourable policy treatment from Modi’s administration, allegations the billionaire has denied.

The Adani Group was established in 1988, beginning with commodities trading. The conglomerate’s business interests now extend from ports and airports to mining and renewable power.

The report said a pattern of “government leniency towards the group” stretching back decades had left investors, journalists, citizens and politicians unwilling to challenge the group’s conduct “for fear of reprisal”.

“The signal is that because the Adanis are very close to the powers that be today, therefore nobody would challenge them,” economist Arun Kumar told AFP.

“Those who earlier criticised Adani, those who tried to do some investigation, Adani’s launched big [legal] cases against them, so they have scared off a lot of people,” he added.