Adani Green Energy, the company at the centre of the case, was down eight per cent in early Friday trade, and has lost a total $7 billion in market value since the news of the indictment. The conglomerate's stocks have seen their combined market value drop by $33 billion.
US prosecutors have charged Adani and seven other people with agreeing to pay bribes to Indian government officials to obtain contracts that could yield $2 billion of profit over 20 years as well as to develop India's largest solar power plant project.
Adani Group said the accusations levelled by US federal prosecutors as well as by the US Securities and Exchange Commission in a parallel civil case are "baseless and denied" and that it will seek "all possible legal recourse".
Adani Ports and Special Economic zone debt maturing in 2027 traded at 91.5c on the dollar, down more than a cent on the day and more than 4c below Wednesday prices.
Longer-dated maturities have fallen around 5c in two days and trade near 80c.
S&P could lower ratings
Ratings agency S&P warned in a statement that the group will need regular access to equity and debt markets given its large growth plans, but that access could now be hampered.
"We believe domestic, as well as some international banks and bond market investors, look at Adani entities as a group, and could set group limits on their exposure," it said.
S&P added it could lower the ratings on Adani Electricity, Adani Ports and an Adani Green Energy subsidiary if the companies started to face weakening funding access and increased funding costs.
Investors are also watching to see if more Adani deals could be scuttled in the wake of the indictments.
Kenya has cancelled a procurement process worth nearly $2 billion that had been widely expected to award control of the country's main airport to the Adani Group.
It also nixed a separate 30-year, $736-million public-private partnership deal that an Adani Group firm signed with the energy ministry last month to construct power transmission lines.
"India's renewable energy sector, a critical pillar for global climate goals, may face reduced international investment as a result of this controversy," said Nimish Maheshwari, an independent analyst who publishes on Smartkarma.
"Investors may demand greater transparency and due diligence, slowing down the pace of project financing."
Adani Green also cancelled a scheduled $600-million U.S. bond sale.
US prosecutors say Adani, his nephew Sagar Adani and others bribed Indian officials to gain business advantages in renewable energy projects in India that benefitted Adani Green and a company called Azure Power, which was listed on the New York Stock Exchange until late 2023.
They are also accused of making misleading statements to the public, including US investors, despite being made aware of the U.S. investigation in 2023.
The Adani Group is a major corporate presence in its home market. That said, Citigroup analysts estimated Indian banks' exposure to the group was less than one per cent of total loans for most lenders.