Shares in companies linked to Indian tycoon Gautam Adani rebounded on Monday, halting a freefall that had wiped more than $20bn from the infrastructure mogul’s net worth in a week.

All six Adani companies recovered, with Adani Green, Adani Power and Adani Transmission hitting the maximum daily permitted rise of five per cent.

The sell-off was triggered last Monday by concerns that three Mauritius-based funds invested in the billionaire’s stocks were frozen by India’s national share depository.

The Adani Group issued a clarification saying that the freeze was on accounts that were separate from those invested in Adani companies. The depository confirmed that the freeze had not affected Adani stocks.

Accounts of Albula Investment Fund, Cresta Fund and APMS Investment Fund had been frozen in 2016 during an investigation into global depository receipt fraud. Earlier in June, markets regulator Sebi imposed penalties on 14 entities in connection with the case.

The sell-off put the spotlight on Adani’s highly leveraged ports-to-apples conglomerate, which has made an aggressive push into new sectors including airports and cement during the pandemic.

The turbocharged rally of Adani Group companies over the past year — Adani Transmission had surged by more than 400 per cent — catapulted the infrastructure mogul into the top echelon of the global rich to become Asia’s second-richest man with a net worth of $78bn, second only to Reliance Industries chair Mukesh Ambani.

Analysts pointed out that Adani stocks have small public shareholdings, with four of the six listed companies having the minimum level of 25 per cent free float, making the stocks more volatile.

The promoter shareholding, the term in India for the person exercising control over the company, is more than 74 per cent in four of the Adani companies.

“In spite of being a fairly large company included in the large cap indexes there are no mutual funds holding the stock; that usually is a red flag,” said Anish Teli, managing partner at QED Capital.

Teli said that investors had become wary of investing in new infrastructure businesses after the poor performance of Reliance Power, led by Anil Ambani, and troubled trajectory of renewable energy firm Suzlon, among others.

“Indian stock markets have not had a good experience with infrastructure companies in the past,” said Teli. “We look at these types of new businesses with a fair amount of scepticism.”