Adani Group reached out to CreditSights on improved net debt: Report

Adani Power |Representative image

The Adani Group reached out to market research firm CreditSights, highlighting its improved net deb, capital management plan, to operating profit ratio and a diversified borrowing book to allay debt concerns raised earlier by a Singapore-based company,  The Economic Times report on September 5.

This comes after CreditSights said in a report over a week ago that Adani group entities, currently expanding, were "deeply overleveraged".

"We have reviewed the CreditSights report and presented our key observations and clarifications on the issues highlighted in it," the Adani Group said in a 15-page note addressing CreditSights concerns, according the report.

Moneycontrol could not independently verify the report.

Also Read: Adani Transmission MCap touches Rs 4-trillion mark for the first time

The Adani group has raised $16 billion via "comprehensive equity" under a systemic capital management plan for half a dozen group firms over the past three years.

These were raised through a combination of primary, secondary and committed equity from global investors including TotalEnergies, Abu Dhabi-based International Holding Company PJSC, QIA and Warburg Pincus, according to the report.

This has also resulted in the deleveraging of the promoter level debt, allowing the reduction in the promoter stake pledge in the listed companies, according to the Adani Group. Adani Enterprises, Adani Green Energy and Adani Transmission have received equity infusion from such investors.

The loans from public sector banks (PSBs) have more than halved to about one-fifth at the end of FY22. Foreign and private banks have extended loans forming 17 per cent of the borrowing book, which had little participation from those sets of lenders six years ago.

"In general, the group has been investing aggressively across both existing and new businesses, predominantly funded with debt, resulting in elevated leverage and solvency ratios," CreditSights said in its report on August 23.

Additionally, Adani's business ventures operate in four broad verticals - energy & utility, transport & logistics, primary industries and FMCG.

"The businesses are fully integrated in their respective sectors and are present across the entire value chain, and account for approximately 85 per cent of all growth capex," the Adani Group said in its note.