The Adani group has reportedly claimed the support of top Japanese and European banks at its investor roadshows held across the globe from Singapore to the US, following the damaging allegations by American short-seller Hindenburg.
A Reuters report, quoting a note put out by the conglomerate, said global banks such as Mitsubishi UFJ Financial Group Inc, SMBC, Mizuho Financial group, Standard Chartered, Barclays and Deutsche Bank have reaffirmed their confidence in the group.
While the document did not elaborate on how the lenders have reposed their faith on the conglomerate, it is being seen as an attempt to soothe investor concerns in the aftermath of the Hindenburg report which at one point of time wiped out more than $130 billion of the market value of the groups’ listed companies.
The document further said that the group has consistently diversified its long-term debt portfolio and has reduced its exposure to banks by using other sources of capital.
It reportedly disclosed that 39 per cent of the conglomerate’s debt is in the form of bonds at present, 29 per cent of its loans are from global banks and 32 per cent of loans are accounted by public and private banks in India.
The PSU lenders in India such as the State Bank of India have not raised any red flags and they were comfortable with its financials, the document said. It also said the lenders “have reaffirmed they will continue to lend to Adani’’.
A joint venture of the group is reportedly in talks with around six global banks for a loan of around $220 million which will be its first offshore borrowing after the Hindenburg report.
During the road shows at Singapore, Hong Kong, Dubai, London and the US, the group is understood to have presented its growth story and its latest attempt to bring down debt rather than indulge in breakneck expansion.
The Adanis were successful in mobilising nearly $1.9 billion from GQG Partners for four of its group companies which has been a big factor for the stocks recouping some of their losses.
Founder and chief investment officer of Florida-based GQG Rajiv Jain said in an interview that he was certain about getting a return in excess of 100 per cent.
“These could be multibaggers” over five years, Jain said. The term, multibaggers, comes from mutual fund manager Peter Lynch’s book and describes an investment that could at least double very quickly over time.
Jain said the Adani Group’s value lies in its assets: citing the group’s coal mines, data centres and the majority stake in Mumbai’s airport as signs of a healthy business. Jain estimated that the airport itself could be worth more than the company.
His views, however, did not have a positive impact on the group stocks with most of them ending in the red. However, Ambuja Cements rose 1.36 per cent, Adani Ports & Special Economic Zone (APSEZ) 1.39 per cent and Adani Wilmar, 0.23 per cent.
The gains in APSEZ stock came as the company reported 9 per cent growth in cargo handling at its sea ports for fiscal year ended March 31. At 339 million tonnes, this is the largest port cargo ever, APSEZ said in a statement.
The firm handled about 32 million tonne of total cargo in March, up 9.5 per cent year-on-year. This is the first time since July 2022 that the volumes crossed the 30-million tonne mark.
India's largest private port operator, with six facilities on the west coast and five on the east, continues to add ports. Earlier this week, it completed the acquisition of Karaikal Port on the east coast.