Abu Dhabi-based conglomerate International Holding Company’s (IHC) decision to subscribe to the follow-on public offering (FPO) of Adani Enterprises Ltd (AEL) triggered a rebound in the group’s dollar bonds on Tuesday.

These debt instruments had dipped to multi-year lows following the damaging report of Hindenburg Research last Wednesday where the short-seller announced that it will take short positions in the Adani group through US traded bonds and non-Indian-traded derivative instruments.

On Monday, reports said the 2027 US-dollar denominated note of Adani Ports & Special Economic Zone (APSEZ) dropped 7.1 cents on the dollar to 72 cents in Hong Kong and at least eight other debt securities dropped more than two cents, leading to their value falling more than hundreds of million dollars in less than a week.

However, they recovered on Tuesday, with debt securities issued by APSEZ, Adani Transmission and another group firm Adani Electricity Mumbai, reportedly trading in the green.

According to Reuters, the bonds of Adani Electricity Mumbai that mature in 2031 led the gainers list, rising 8.21 cents to 70.19 cents.

The bonds of APSEZ were also trading higher over three cents.

On Monday, IHC announced it will invest AED 1.4 billion ($400 million or Rs 3,260 crore) in the FPO of group flagship Adani Enterprises.

IHC said the investments are part of a strategy to diversify locally and internationally focusing on Europe, Africa, Asia and the South American markets in 2023.

It was the second deal IHC has completed with the Adani group after last year’s $ 2 billion funding in three green-focused companies, including Adani Green Energy, Adani Transmission and Adani Enterprises.

The investment by IHC was one of the reasons behind the Rs 20,000cr FPO of Adani Enterprises being fully subscribed on Tuesday.

Observers said that while the development could bring some respite to shares and bonds of the Adani group, their upside could remain limited amid the allegations made by Hindenburg Research. The Adani group has rejected these charges.

On Tuesday, investors kept up the pressure on Adani stocks even as they turned their attention to the budget and the two-day US Federal Open Markets Committee meeting which concludes on Wednesday.

The investors said if the markets react positively to the budget and sentiment improves, there could be some respite for the Adani stocks.