Gautam Adani: From Diamond Trader to Billionaire Tycoon

Morning folks and welcome to today’s episode called “Gautam Adani: From Diamond Trader to Billionaire Tycoon.”

He was once the second richest man on Earth — richer than Bezos, Arnault, Buffet. He left school at 15, and over the last 50 years, he has built a huge empire spanning ports, power plants, and airports, his success fueled by risk, relentlessness, and a powerful friendship with India’s prime minister.

I knew about Adani for a while, but it was only when I mentioned him briefly while talking about the Hindenburg Group in the episode on short sellers that I thought I’d love to cover this guy—and his story is so well worth it. There are billions, a kidnapping, a terror attack, and a lot of alleged corruption. It’s a cracking episode — enjoy.

Gautam Adani was born on June 24th, 1962, in Ahmedabad, in the state of Gujarat on the west coast — the seventh of eight children, a middle-class Jain family. His father ran a small textile business, so business, talk of trades, and margins were part of young Gautam’s everyday life.

Gautam wasn’t into books. He was restless, curious. His family called him “Toofani” — stormy — because he had this energy, he was always hustling.

By sixteen, he’d had enough of school, and in 1978, he packed a bag and headed to Mumbai to live with his older brother, Vinod. His first job was sorting diamonds for cutting and polishing, and this part of the diamond business, with its razor-thin margins and fast cycle of buying and selling across borders, honed Adani’s financial instincts and tolerance for risk.

By 1979, he’d started a small brokerage with two cousins — trading diamonds. Within a year, he’d made his first million rupees in profit — that was about $125,000 — not bad for a teenager. Yet despite this success, in 1982, he left the diamond trade and Mumbai because he saw bigger opportunities in his home state of Gujarat, as India’s industrial economy started to improve.

He joined a small plastics factory his elder brother had bought the year before. And by all accounts, Adani threw himself into the work, modernizing operations and expanding sales at this factory.

There’s a story from those years that captures him perfectly. He was chasing business from Reliance Industries — back then, India’s fastest-rising textile empire. Reliance needed huge quantities of packaging film, and Adani wanted those orders. So he befriended Reliance's purchasing manager, then made a point of meeting him every morning, learning what competitors were quoting, and then he’d undercut every one of them.

As the business grew, Adani realized the real bottleneck wasn’t in sales — and in fairness, when you have the kind of chutzpah that Adani had, sales come easy — the real choke point was in supply. PVC resin — the raw material for his film — was scarce in India’s insulated, state-controlled economy.

So in 1983, he and his brother began importing in bulk, which was a lot harder than it sounds, because back then there was a system called the License Raj, which tightly controlled foreign trade — you had to jump through hoops of bureaucracy, call in favors, and have the right connections to get a licence. And as you can imagine, Adani was relentless, working the phones, calling in every connection, exploiting every loophole. His timing was pretty good. The government had just started loosening import rules for a handful of key materials to keep factories running. So they got a licence, and combined with additional liberalized import rules that came into effect in 1985, Adani, with a work ethic that people close to him describe as almost frenetic, personally negotiated deals from petrochemical hubs like Japan and South Korea, then worked around the clock to get shipments allocated to manufacturers across India. For context, India’s mid-’80s economic liberalization was limited, but entrepreneurs like Adani who seized the opportunities that were there could establish control in their particular sectors very quickly. So Adani seized this opportunity and began diversifying.

Busy as he was, he still managed to find the time to get married to a dentist from Mumbai in 1986, and they had two sons.

In 1988, he set up Adani Exports — the company that would become the Adani Group. It began trading plastics, agricultural goods, power equipment, and fertilizers — areas where Adani saw high growth potential.

In its first year, Adani Exports recorded a turnover of ₹2.2 crore — roughly $1.3 million in 1988, so good numbers, and the revenue grew at a fast rate over the coming years — helped by two things: Government-backed institutions like the Gujarat State Export Corporation helped new exporters with financing and contracts, but more importantly, Adani’s drive — he found a formula that worked for him: trading products that had high volume, low margin, fast turnover, and of course done with absolute confidence.

Then in 1992, a deal that didn’t happen had a huge impact: Adani did a deal with the American agribusiness giant Cargill to build huge salt farms along the barren coastline of Mundra, western India, complete with a private jetty.

However, Cargill pulled out after protests erupted over foreign control of India’s coastline. Adani was also not willing to accept Cargill’s deal that would leave him with just 11%. Despite the deal collapsing, Adani decided to go ahead, but instead of building salt farms, he was going to build a port.

You see, his own trading business was being severely hampered by delays at government-controlled ports, costing up to ₹10 crore a year (about $3.5 million back then), so he realized that owning the infrastructure would give him far greater control, and this really set in process a new addition to his formula — remember, it was high volume, low margin, fast turnover.

Well, added to this now was Adani’s vision to have complete control over the delivery of his goods.

He had no experience in building or running a port, and Mundra didn't start off as a huge port — it opened in 1998, and its early years were humble — because it just had a single berth handling salt and fertilizer shipments.

But India’s economy was growing, and shippers sought alternatives to the congested ports in Kandla and Mumbai.

Over the years, Adani kept building onto it, modernizing it, and today the port is responsible for 11% of all of India’s imports by sea — it controls nearly 33% of India’s container traffic, and it’s fair to say that the Mundra port formed the cornerstone of Adani’s future growth and success — the group now has 13 ports in total.

Adani was rising fast, building a very successful business, and it appears that he came to the attention of some very dangerous people.

Because on January 1st, 1998, Adani and an associate were leaving a business dinner when they were kidnapped by gunmen linked to the notorious mobster Babloo Srivastava — I looked up this guy — he’s currently in jail but at one stage he was wanted in 42 cases involving murder and abduction. So definitely not a guy to be messed with. Adani and his associate were released unharmed the next day. Although it’s never been confirmed, a ransom of about $2 million is believed to have been paid. And here’s a quote from Adani in relation to that kidnapping that gives you an idea of his temperament: “It's my nature to adapt to things as quickly as possible. It's not in me to lose my peace over what's not in our control. I was kidnapped and released the next day. I tell you, that I slept well that very night.”

In 1999, he launched a coal-trading arm, betting early on India’s growing demand for power, and of course, it all played into his vision for controlling every aspect of his business, because as he saw it, and rightly so, power is a part of infrastructure. Turnover jumped from ₹150 crore ($53 million) in 1992 to nearly ₹2,853 crore ($660 million) by 1999.

And by 2006, Adani had become India’s largest coal importer — that same year, he founded Adani Power and began building a massive thermal plant near Mundra.

And I know I’m jumping ahead a bit, but if I were to detail every single business this guy got into, we’d be here for hours. By the late 2000s, Adani was being hailed as one of India’s fastest-rising billionaires, and in 2008, he made his first major international move — and as you can imagine, for someone who wants to control every element of his business, as his coal-importing business started to thrive, he wanted to own the coal — so he bought the huge Bunyu coal mine in Indonesia for $1.65 billion.

But that same year, 2008, saw another hugely dramatic event in Adani’s life. It’s the night of November 26th, 2008. Inside the Taj Mahal Palace Hotel in Mumbai, Adani had just finished dinner with some business associates. He’d paid the bill and was about to walk out into the hotel lobby when his companions suggested staying for another round of coffee. He agreed. And that probably saved his life, because seconds later, terrorists stormed the lobby, opening fire indiscriminately. Adani could see them from his seat in the restaurant. As he said himself: “I saw death at a distance of just fifteen feet.”

The hotel staff hustled Adani and other restaurant guests through a back door, into the kitchen, then down into the basement where they stayed for over two hours. Over a hundred people crouched together in the dark, breathing stale air.

After two hours, the basement grew too suffocating. The staff moved everyone again — up to the chamber hall, an upper floor thought to be safer. Some people hid under sofas. Others prayed. Adani recalled sitting on a sofa, trying to calm those around him by telling them to "have faith in God."

After a failed rescue attempt that led to some of the hotel staff being shot dead, at around 8:45 a.m., commandos managed to cordon off the hotel and secure a safe exit, and they eventually made it out at dawn — 31 people had been killed in the hotel. And what I really like about Adani from this episode is not only the calmness but also the fact that he never made this hugely dramatic and possibly traumatic experience about himself. Whenever asked about it, he always expresses profound gratitude for the dedication and heroism of the hotel staff. He said: "The type of dedication that the Taj staff showed at the time of that attack is rarely seen."

Over the coming years, Adani continued to expand at a huge rate: Between 2010 and 2013, he spent over $4 billion in Australia buying a coal mine and port. The power plant in Mundra became the largest power station of its kind in the world. Group revenues surged to 47,000 crore, about $8.7 billion — nearly triple what they’d been six years earlier. But the company's borrowing was even bigger at $11.3 billion.

Now, if all of this growth seems to be happening at a fast pace, Adani was really only starting, because his business became turbocharged with the election of Narendra Modi as India’s prime minister in May 2014.

So let's take a quick look at the background to that relationship.

Before 2002, there’s no public record that Adani and Modi had ever met.

In early 2002, Gujarat, the state that they both come from, was torn apart by communal riots in which over 1,000 people, mostly Muslims, were killed. Modi was just months into his first term as Chief Minister of the state, and he was facing national outrage and isolation. India’s business elite kept their distance. But Adani — along with a small circle of Gujarati industrialists — saw opportunity and helped form the “Resurgent Group of Gujarat,” a business lobby that rallied around Modi, pitching stability and growth over scandal. Their partnership would become one of the most consequential and controversial in modern Indian capitalism.

I think the key to understanding their relationship is looking at how aligned they have been over the last 23 years or so.

The glue that binds them together is a shared vision for where India can go, and how it can get there, and infrastructure is key to this. And look, I’m not positing this as some sort of higher cause — of course, they’re also doing this out of self-interest — but I do think they believe that by working together, they can get the job done better, quicker. And it’s always been a mutually beneficial relationship — Modi has helped Adani’s businesses, and Adani’s business successes helped the Gujarat state become very prosperous, which in turn helped Modi become President of India in 2014.

Critics have rightly accused Modi’s government of bending rules to smooth Adani’s path — amending regulations, easing clearances, and awarding contracts. And nowhere is this more evident than in February 2019, when the government auctioned six airports. Internal government records revealed that the Finance Ministry had objected to one bidder taking more than two airports, citing “high financial risk and performance issues.” And yet Adani won all six.

So between 2014 and 2022, the Adani Group’s value rocketed from $8 billion to $288 billion. By now, the company was split into four parts — ports, power, transmission, and the parent company. And it wasn’t all just in India — they had bought a huge coal and rail facility in Australia for $16.5 billion — it had become a truly international conglomerate.

In September 2022, when its share price peaked, Adani’s net worth reached $155 billion, catapulting him to the position of the world’s second-richest person, surpassing Jeff Bezos and Bernard Arnault.

But of course, the worst thing about peaking is that there can be a very steep and dangerous fall.

The first taste of this came just a month earlier, in August 2022, when a research company called CreditSights released a report that warned the Adani Group was “deeply overleveraged,” even cautioning of a “worst-case scenario of default” if its expansion continued unchecked.

Adani brushed it all aside. “Scale and speed are essential for India’s development,” he told Bloomberg, insisting the group’s internal controls were robust.

But Adani was unable to brush aside the next report that landed with a fairly big thump on January 24th, 2023, when U.S. short-seller Hindenburg Research published a 32,000-word report that accused the Adani Group of “pulling the largest con in corporate history.”

It was the result of a two-year investigation, and one of its central allegations was that Adani’s elder brother, Vinod, ran a vast network of offshore shell companies in Mauritius, and these entities were used to manipulate — i.e. inflate — stock prices.

The report also highlighted that the group's key listed companies were "on precarious financial footing" due to substantial debt, much of it secured by pledging their inflated stock as collateral.

But what I found even more surprising is that most of the allegations in the Hindenburg report had already been in the public domain. For example, the charge that they were manipulating stock through shady entities in Mauritius — there were reports of this two years previously, and the market regulator in India had started looking into it, but then the case went quiet.

What made the Hindenburg report stand out wasn’t really what they said, but simply the fact that all of the different allegations and dubious practices that had been said about Adani were now concentrated in a single report, and it looked pretty damning.

The political opposition seized the moment, accusing the government of cronyism and weak oversight.

Within forty-eight hours, the group’s market value had fallen by $50 billion. Adani’s own fortune dropped by more than $20 billion, knocking him out of the world’s top ten richest. Inside the group’s headquarters, a crisis war room was set up. Adani’s team called the report “bogus,” “maliciously mischievous,” and a “calculated attack on India” and on “the independence, integrity, and quality of Indian institutions.”

Then their CFO, Jugeshinder “Robin” Singh, appeared on television calling it “a lie” and assuring investors the company’s finances were sound — and right beside him as he made his TV appearance was a large Indian flag.

Now, I get why Adani would be pissed — the timing of the Hindenburg report seems to have been calculated to do maximum damage — because the company was just three days away from a massive ₹20,000 crore (~$2.5 billion) Follow-on Public Offering (FPO), and this equity sale — the largest ever in India at the time — was a test of investor faith, but of course, it was also vital because it was raising funds that the company needed to pay off some of its huge debts.

So yeah, I get why they were pissed, but the Hindenburg report wasn’t some geopolitical hit job — it was an activist short-seller doing what they do: finding issues, highlighting them, and profiting if they’re right. Adani wasn’t being singled out because it was Indian; it was being treated like any other major global conglomerate under scrutiny.

And here’s the thing — when a company claims to be a world-class multinational, it has to accept that it’s going to come under scrutiny. Hindenburg’s questions about leverage, share price manipulation, and regulatory oversight weren’t insults to India’s integrity; they were tests of transparency — and the report exposed issues with oversight in India.

And Adani’s reaction — framing it as an attack on the nation, turning corporate criticism into a national grievance — only made the group look brittle, not strong.

Standing tall means answering the questions, not hiding behind the flag. It was pathetic.

Three days after Hindenburg’s report, Adani pressed ahead with the $2.5 billion share sale, but by now, of course, the stock was sinking, the offer priced above market, and even though they managed to get it across the line, investors who had committed to it were now looking at huge losses, so the company had to reverse course and refund the cash.

A few days later, Adani put out a 413-page report to counter the Hindenburg accusations, but it didn’t have much of an impact.

Over the next few weeks, the group’s market value dropped by $150 billion, and Adani’s wealth had halved. Regulators scrambled to contain the fallout.

In early March, India’s Supreme Court ordered an expert panel to review the allegations and assess whether regulators had failed. Two months later, the panel flagged “suspect trading patterns” and weak enforcement, but gave up their investigation when the country’s markets regulator admitted to “drawing a blank” in its investigation. The regulator’s chair was subsequently accused of holding stakes in an offshore entity used by Adani’s family.

Then in August of 2023, the Amsterdam-based Organized Crime and Corruption Reporting Project (OCCRP) — a non-profit news group — dug into those very strange Mauritius companies. And unlike the regulators in India, the OCCRP investigation found that two Adani family associates secretly pumped hundreds of millions of dollars into Adani stocks through Mauritius funds between 2013 and 2018, effectively shoring up prices. The trail pointed toward Adani’s brother Vinod. The report highlighted a 2014 letter from India’s revenue intelligence chief warning the regulators that Adani-linked funds might be manipulating stock prices — a warning that seemed to vanish once Modi took office.

It wasn’t all doom and gloom for Adani, because as the share price was falling, Florida-based GQG Partners, led by Rajiv Jain, invested $1.87 billion buying Adani shares on the open market. The deal lifted sentiment. Adani shares rebounded, recovering around $15 billion in market value.

Throughout 2023, the Adani Group focused on repairing its image: repaid over $2 billion in loans, quietly cut back on expansion spending, improved disclosures, and shored up liquidity by selling stakes in certain assets. The message was clear: discipline had replaced exuberance. Yet, at the same time, big gaps remained between Adani’s denials and the questions raised by researchers and journalists.

But just when it looked like they’d weathered the storm, the real blow landed.

On November 20th, 2024, the U.S. Department of Justice unsealed a five-count indictment charging Gautam Adani, his nephew, and six others with bribery, securities fraud, and wire fraud. Prosecutors allege Adani paid $265 million in bribes to Indian officials to secure solar deals.

And apparently, they have some very damning evidence — phone records that had details of the bribes actually being offered to the officials, Excel spreadsheets and PowerPoint presentations that outlined how the bribes were going to benefit the company, and — I love this — records where some of the other defendants refer to Adani as “Mr. A,” “Numero Uno,” and “The Big Man.”

Like, this is amateur hour — leaving evidence of your bribery so open — but I’m guessing they were so careless because in India, they’ve been untouchable. It’s pretty apparent that they’ve never come under any type of scrutiny in India — and they never thought for a minute that the U.S. would look into their affairs. But this is a stark reminder that once you start borrowing money in foreign countries, you are now playing by their rules.

Because that’s the reason why the U.S. did look into this — the charge is that Adani raised over $3 billion in loans and bond offerings from U.S. investors while concealing the bribery.

And this isn’t a governance squabble; this is a criminal case — and it has a direct impact on his reputation, his ability to travel, and his access to international debt markets.

But surprisingly, or maybe not surprisingly, there’s a good chance that Adani, like lots of other billionaires caught doing something wrong, will be able to settle these charges without conviction, because under U.S. securities laws, the accused can negotiate with regulators and pay a fine without admitting guilt. So you can be caught bribing officials, but if you have the means, you’re good to go. And we wonder why people are so disillusioned with the system???

So what to make of Adani? Well, there’s a lot about Adani that I like. Despite his huge wealth, he lives a very grounded life. His daily routine includes family time for meals, and he unwinds by playing the card game rummy with his wife. He distrusts overly complex, jargon-filled analysis. And while he’s relentless and restless, always pushing, by all accounts, he treats those around him fairly. I made reference to the way he spoke of the hotel staff after the terrorist attacks — it's a small detail, but to me, an important one, because it’s these kinds of details that give us an idea of his character.

But then, on the other side of the scale, are the allegations of cronyism, corruption, and bribery — and yes, they remain allegations — but the body of evidence over thirty years is hard to ignore. Adani believes he’s helping India and its people — that he gets things done, pushing the country to compete on the global stage. I think he really does believe that, even as he builds a vast fortune for himself. And in the short term, his achievements have brought growth and ambition to India. But the end doesn’t justify the means. Corruption, cronyism, and bribery erode public trust; they erode faith in the very idea of fairness. And so, when the foundations of progress are built on very compromised foundations, it inevitably affects not just the democratic well-being of a country but also has a negative long-term impact on its progress.

The story of Adani — the ambition, the massive achievements, and now the accountability — makes it such a great business story. And with that, we come to listeners’ emails — and I love this one from Leonard, who wrote: “I really enjoyed the episode on the browser war and your analysis on why Gates released all of the incriminating material to the government. One other reason why he did it, I think, is linked to the fact that email was very new back then — and I don’t think he realized how damaging those emails would be.” Brilliant point, Leonard — and I think you’re absolutely right. Thanks for the insight.

And remember, if you have any comments, any corrections, or any story you’d like us to cover, email me at info@gbspod.com.

All the best, folks.