Sebi seeks details on Adani Group firms' loans and securities from rating agencies

So far, only international credit agencies like S&P and Moody's have changed the outlook on some of the Adani companies from 'stable' to 'negative'

The Securities and Exchange Board of India (Sebi) has sought details of all ratings of local loans and securities of Adani group companies from credit rating firms, the Economic Times reported.

The Indian capital markets regulator asked rating companies to share information, which would include all outstanding ratings, outlook, and possible updates from any discussions with officials of the business group.

Moneycontrol could not independently verify the report.

"Sebi is probably trying to ascertain whether the sharp fall in stock prices of several Adani companies would have any bearing on the liquidity positions and the debt repayment capability of the borrowing companies... Most of this information, however, is in public domain," a person aware of the communication from the regulator told ET.

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While stocks of 10 Adani listed companies have dropped between 21.7 percent and 77.47 percent - with Adani Total Gas falling the most, followed by Adani Green Energy and Adani Transmission - none of the rating companies in India have changed the ratings or outlook for Adani companies.

The rout was triggered by Wall Street short-seller Hindenburg Research alleging price manipulation and accounting fraud by the group.

A sudden fall in the share price is among the 'material events' that rating agencies typically factor in to review a borrower's rating and outlook, or put it under 'rating watch', ET mentioned.

"Since it's close to a month since the Hindenburg report, it possibly cannot be a material event for any rating action. Under the circumstances, rating companies would keep track of other parameters, like a further fall in share price, or other developments for any action," a banker told ET.

So far, only international credit agencies like S&P and Moody's have changed the outlook on some of the Adani companies from 'stable' to 'negative', primarily due to rapid decline in the market value of the companies concerned. Local agencies believe the group may review some of its capital expenditure.

The MC A10 index – a sentimeter of Adani Group stocks – ended sharply lower on February 20 as bears continued to mount pressure on the stocks. The index fell about 5.36 percent to 35.37 and was pulled down by heavyweights Adani Enterprises, Adani Green Energy, Adani Total Gas and Adani Transmission. They fell 5-7 percent each.

The index captures the real-time price movement in all 10 Adani group stocks. The individual companies in A10 have weights in proportion to their total market cap.

Index provider FTSE Russell has also been monitoring information on Adani Group stocks and will proceed with scheduled index review changes for the securities, it said in a press release on February 18.