Adani Group has liquidity, cash flows to serve debt, says CRISIL Ratings

Ratings of 24 group firms under 'continuous surveillance', says agency about conglomerate facing legal charges in the US

The Adani Group has sufficient liquidity and operational cash flow for debt obligations and capital expenditure over the medium term, said CRISIL Ratings on Friday as senior executives of the Indian conglomerate face charges of fraud in the US .

 

The Indian rating agency's statement follows the US Department of Justice and the US Securities indictment and Exchange Commission’s (SEC) civil complaint against Gautam Adani, Sagar Adani and Vneet Jaain, key functionaries of Adani Green Energy Ltd (AGEL). The complaint was filed in the district court for the Eastern District of New York.

 

The charges relate to allegations of securities fraud, wire fraud and violation of the SEC guidelines that purportedly led to materially false and misleading statements in the bond offering documents of AGEL with respect to anti-bribery and anti-corruption policies.

 

 

CRISIL Ratings said in a statement it had noted these developments and their likely impact on the finances of the Adani Group, including fall in the market capitalisation of the listed companies. It has also taken note of the movement in bond yields, and calling off the $600 million bond offering of AGEL.

 

“Based on management and select lender feedback, CRISIL Ratings understands that these developments have not led to any negative actions so far by lenders/investors, such as acceleration of debt repayment or spread resets. Further, we understand the Adani Group has the flexibility to reduce certain discretionary capital expenditure (capex) depending on developments in financial markets and future capital availability,” it said.

 

The Adani Group reported a healthy ebitda (earnings before interest, taxes, depreciation, and amortisation) of Rs 82,917 crore for financial year 2024 with a net debt to ebitda ratio of 2.19 times. Cash balance was over Rs 53,000 crore across eight listed operating entities as on September 2024 against long-term debt maturities of [around] Rs 27,500 crore and go-to market/construction facility of Rs 8,919 crore during October-March fiscal 2025 and Rs 2,137 crore during fiscal 2026, it added, noting that the charges against the group are sub judice.

 

The rating agency has ratings on 24 entities of the group, including Adani Airports Holdings Ltd, Adani Power Ltd, Mumbai International Airport Ltd, Adani Power Ltd, Ambuja Cements Ltd and ACC Ltd. "All our outstanding ratings are under continuous surveillance," it said.