According to a presentation the conglomerate provided to investors, the Adani group has about USD 2 billion in foreign-currency debts that are due for repayment in 2024. This is due to the business’s primarily debt-fueled fast expansion, which saw gross debt double in four years.
Between July 2015 and 2022, the group entities that make up the apples-to-airport conglomerate borrowed nearly USD 10 billion in foreign currency bonds. 1.15 billion dollars’ worth of bonds with maturities in 2020 and 2022.
There are no maturities in 2023, but three issuances totaling USD 650 million from the ports arm APSEZ and USD 750 million and USD 500 million from the renewable energy company Adani Green Energy Ltd come due in 2024.
To convince investors that the company’s finances are in order, Adani group management, including group chief financial officer Jugeshinder Singh, held roadshows in Singapore and Hong Kong last month. From March 7 to March 15, these will be expanded to Dubai, London, and the US.
Investors were informed by executives that they would use cash flow from operations and maybe offer private placement notes to deal with approaching debt maturities.
According to the presentation given to investors last month, the gross debt of the Adani group will increase from Rs. 1.11 lakh crore in 2019 to Rs. 2.21 lakh crore in 2023. The net debt in 2023, including cash, was Rs 1.89 lakh crore.
No foreign currency bonds will mature in 2025, however there will be USD 1 billion in payback obligations.
A month after a stinging report by a US short seller reduced the market value of the listed companies owned by the Adani group by USD 135 billion, the conglomerate is attempting to change the narrative by opting for moderate, steady growth over the rapid, largely debt-fueled expansion of recent years.
It has already abandoned a Rs 7,000 crore coal acquisition plan, declined to compete for a stake in the government-backed energy trading company PTC, cut costs, paid down some debt, and committed to repaying more.
In a study published on January 24, Hindenburg Research accused the Adani group of engaging in “brazen stock manipulation and accounting fraud” as well as utilising several offshore shell firms to artificially increase stock prices.
The organisation has refuted all claims, calling them “malicious”, “baseless” and a “planned attack on India”.
Ten listed companies belonging to the Adani group were sold off for Rs 12.06 lakh crore as a result of the study. This was almost on par with the market value of Tata Consultancy Services (TCS), the second-most valued firm in India.
First-generation businessman and group founder Gautam Adani, 60, lost USD 80.6 billion in wealth, mostly due to the valuation of his stake in group firms.
Prior to the Hindenburg, he was the third richest man in the world and the biggest businessman in Asia, with a net worth of USD 120 billion. The Hindenburg report, however, caused his ranking to drop to No. 34.
However, a rise in all group stock during the previous three trading sessions has allowed him to return at No. 24, with a net worth of about USD 50 billion. He overtook Mukesh Ambani last year to become the richest businessman in Asia and the third-richest person in the world, but he still lags behind him today.
With an estimated wealth of $82.6 billion, Ambani is rated No. 11.
