Adani Enterprises, Adani Energy Solutions may soon tap markets for QIPs

Adani Enterprises, Adani Energy Solutions may soon tap markets for their QIPs

Adani group companies Adani Enterprises Ltd and Adani Energy Solutions are gearing up to tap the markets soon by way of qualified institutional placement (QIP) offerings  to raise as much as $2.5 billion, people aware of the group’s plans told Moneycontrol.

Moneycontrol first reported on May 26 that the boards of Adani Enterprises Ltd and the group’s energy transmission and distribution business Adani Energy Solutions Ltd were looking to approve fundraising plans to the tune of $3.5-4 billion, collectively.

The group has been engaging with investors over the last couple of weeks and the two QIPs could be launched after the budget, said the persons cited.

Adani Enterprises and Adani Energy Solutions will collectively raise around $2-2.5 billion, with Adani Energy Solutions likely to raise around $750 million (approximately Rs 6,266 crore) and Adani Enterprises raising around $1.5 billion (approximately Rs 12,532 crore).

The two companies plan to use the proceeds to fund capex and growth plans as well as to repay certain borrowings of the company.

Investment bank Jefferies and Axis Capital have been appointed to manage the fundraising process of the two companies,  said the people cited.

Both the companies have recently received shareholder approval for their fundraising plans. Adani Enterprises shareholders had approved a plan to raise up to Rs 16,600 crore while shareholders of Adani Energy Solutions had approved a fundraise of up to Rs 12,500 crore.

An email sent to the Adani group companies, Jefferies and Axis Capital did not elicit a response till the time of publishing.

The plans to raise funds through a possible equity dilution comes at a time when Adani group stocks have shrugged off the impact of the Hindenburg Research report of January 2023 and reached the pre-Hindenburg levels.

On May 24, Moneycontrol reported that six Adani Group stocks, including Adani Enterprises Ltd, Adani Green Energy Ltd and Adani Ports & SEZ, have erased the losses triggered by the Hindenburg report and are now trading above their January 2023 levels, when the report was published by the short seller.

In an interesting development in the Adani-Hindenburg saga, earlier this week, American short-seller Hindenburg Research called a Sebi show-cause notice arising out of its 2023 report against Adani Group nonsensical and concocted.

“We think it is nonsense, concocted to serve a pre-ordained purpose: an attempt to silence and intimidate those who expose corruption and fraud perpetrated by the most powerful individuals in India,” Hindenburg said in a post on its website.

Also Read: SEBI’s key allegations against Hindenburg: False disclosures and fraudulent transactions

According to Hindenburg, the show-cause notice, which was emailed on June 27, did not take into account the content of its 106-page report but only the technical elements related to its disclaimer.