A follow-on share sale in Adani Group’s flagship company Adani Enterprise was only 1% subscribed on Friday’s opening day as shares plunged following a scathing report from US short-sellers. According to information provided by the BSE, only 470,000 shares of Adani Enterprises Ltd’s offer of 455,500 shares were subscribed.

The FPO closed on January 31.

Shares of Adani Enterprises fell nearly 20%, below its secondary sale offer price, as all seven listed companies in the group took a hit after Hindenberg Research claimed the group was “engaged in a brazen stock manipulation and accounting fraud scheme over decades”.

The report came on Wednesday when the follow-on public offering (FPO) opened to institutional investors.

Adani Enterprises is selling shares at Rs 3,112 to Rs 3,276. Its shares closed at Rs 2,762.15 on the BSE on Friday.

Retail investors bid nearly 400,000 of the 2.29 crore shares reserved for them, while qualified institutional buyers (QIBs) subscribed for just 2,656 of the 1.28 crore shares reserved for them. Non-institutional investors subscribed for 60,456 shares out of 96.16 lakh shares.

On Wednesday, Adani Enterprises raised Rs 5,985 crore from lead investors.

The company allotted 1.82 crore shares to 33 funds at Rs 3,276 each, bringing the deal size to Rs 5,985 crore, according to a notification uploaded on the BSE website.

Foreign investors buying shares included Abu Dhabi Investment Authority, BNP Paribas Arbitrage Bank, Societe Generale, Goldman Sachs Investments (Mauritius) Pte Ltd, Morgan Stanley Asia (Singapore) Pte Ltd, Nomura Securities Singapore Pte Ltd and Citigroup Group Mauritius Global Markets.

A large group of domestic institutional investors, including LIC, SBI Life Insurance Company, HDFC Life Insurance Company and State Bank of India Employees’ Pension Fund, also participated in the master book.

Of the Rs 20,000 crore proceeds from the FPO, Rs 10,869 crore will be used for green hydrogen projects, existing airport works and greenfield highway construction.

Rs 4,165 crore will be used to repay the debt of its airport, road and solar project subsidiaries.

Adani Enterprises is India’s largest listed business incubator, incubating companies in four core industry sectors – Energy & Utilities, Transportation & Logistics, Consumer Goods and Primary Industries.

The current business portfolio includes Green Hydrogen Ecosystem, Data Centres, Airports, Digital, Mining, Defence and Industrial Manufacturing.