Shares in the business empire of Asia’s richest man Gautam Adani nosedived Friday, extending this week’s losses to $45 billion, days after a US investment firm claimed it had committed “brazen” corporate fraud.

Adani, 60, began his week the world’s third-richest person but has tumbled down the rankings to seventh on Forbes’ billionaires tracker after losing $24bn in Friday’s trade.

His flagship Adani Enterprises plunged 15 per cent in Mumbai after midday, a fall of 508.45 rupees, triggering an automatic trading halt alongside five of its seven main listed subsidiaries.

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

Hindenburg Research this week alleged in a 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.

But the conglomerate said on Thursday it was the victim of a “maliciously mischievous” reputational attack by Hindenburg just as it was preparing for a major fundraising round.

Legal chief Jatin Jalundhwala said in a statement that Hindenburg’s short position in the firm, announced in the report’s release, was proof the company had a vested interest in driving down Adani stocks.

Adani was exploring its punitive action against the research advisory in US and Indian courts, he added.

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.”

Shares in Adani business units have soared as much as 2,000pc in the past three years, adding more than $100bn to its founder’s net worth and vaulting him up the ranks of the world’s richest people.

Adani — who now has an estimated fortune of $95bn — is considered a close supporter of Prime Minister Narendra Modi.

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 issues strike at the heart of the Indian corporate sector scene where a number of family controlled conglomerates dominate,” Gary Dugan, chief executive officer of the Global CIO Office, told Bloomberg.

“By their very nature, they are opaque, and global investors have to take on trust the issues of corporate governance.”

‘Old news’

Its allegations come as an ambitious $2.5bn follow-on public offer — India’s biggest-ever — opened for bids on Friday, aimed at bolstering the business empire’s balance sheet.

“The report is 100pc unsubstantiated,” market analyst Arun Kejriwal said, adding that Hindenburg is looking to “make money” with its short position in Adani.

“It is just a compilation of old news at a time when it hurts them the most,” Kejriwal said. “The more scandalous they make it, the more damage it causes.”

Shares in Adani Enterprises fell to 2,720.90 each at its lowest point in the day, below the FPO price band of 3,112-3,276 rupees per share.

Hindenburg’s report accused Adani Group of engaging in a “brazen stock manipulation and accounting fraud scheme over the course of decades”.

It claimed Adani’s elder brother Vinod managed “a vast labyrinth of offshore shell entities” in tax havens including Mauritius, Cyprus and several Caribbean islands.

The Mumbai stock exchange’s benchmark Sensex index was down 1.8pc on Friday afternoon, primarily dragged down by the Adani rout.