At least five companies from the Adani group are reportedly planning to cumulatively raise Rs 15,000 crore through domestic bonds
With market conditions stabilising and group firms successfully mobilising funds from overseas investors such as GQG Partners, Gautam Adani is set to tap the Indian bond markets with more issuances after flagship Adani Enterprises Ltd (AEL) raised Rs 1,250 crore in rupee bonds earlier this month.
According to a Bloomberg report, group companies that include Adani Ports and Special Economic Zone Ltd, Adani Electricity Mumbai Ltd, Mumbai International Airport Ltd, Navi Mumbai International Airport Ltd and AEL are planning to jointly mop up Rs 15,000 crore this financial year.
The report added that the debt instruments are likely to be sold in small Rs 500-1000 crore lots of listed and unlisted bonds to meet capital expenditure requirements. While discussions are in the initial stages, the final amount could also be double the envisaged sum, the report added.
AEL had recently raised Rs 1,250 crore through the issue of 1,25,000 secured, unrated, unlisted, redeemable, non-convertible debentures (NCDs) of the face value of Rs 1 lakh each on a private placement basis.
The three-year bond came with an annual coupon of 10 per cent and it was priced at a spread of 300 basis points over comparable government bonds.
AEL’s previous bond-raising was before the Hindenburg allegations: in September 2022, it made a primary placement of bonds at an 8.40 per cent yield for 17 months, which was 140 basis points above the prevailing government bond yield. Three companies from the group are planning to separately raise Rs 33,000 crore through a qualified institutional placement (QIP).
The conglomerate’s move to thus tap both equity and debt indicates it has regained the confidence to mobilise funds.
It also shows the group firms would resume some of the expansion plans which were kept on hold after the Hindenburg report. This came as Gautam Adani focussed on trimming debt.
In January, Hindenburg Research released a damning report alleging accounting fraud and stock price manipulation at the group, which led to a huge erosion of $140 billion in the conglomerate’s market value at one point.
Since then, its move to pre-pay share-backed debt and investments from overseas investors that include GQG Partners has resulted in the stabilisation of the stock prices of group companies.
Earlier this month, group chairman Gautam Adani said he was confident of the group’s governance and disclosure standards.