A fairly large group of people are at a waterfront of some kind like a river with lots of rocks around them, bathing and gathering up some water.
People are hanging out around some water.
The term people includes a fairly large group of people. 'Hanging out around some water' is a way of paraphrasing 'at a. waterfront of some kind like a river with lots of rocks around them, bathing and gathering up some water'
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