The juggernaut has rolled into London where Adani group officials are claiming that they have now paid back all share-backed loans.
The port-to-power conglomerate, wracked by the allegations of fraud and stock manipulation by US short-seller Hindenburg, is toting up meetings with investors at financial hotspots to win back their confidence. The group has dismissed the charges of Hindenburg.
The road show will move on to Los Angeles and then to New York – the home of Hindenburg Research – later this week where investors are likely to ask tougher questions.
Last week, the Adani group officials met bond investors in Singapore and Hong Kong to soothe their concerns that the conglomerate’s access to funds were under control — followed by the drive to Dubai, London and US.
The Rs 15,500 crore investment by GQG Partners in four Adani group firms was seen as a shot in the arm for the beleaguered group.
A Bloomberg report, quoting participants in London, said that senior executives told the investors that the promoter family have prepaid all borrowings against the shares of listed firms.
But questions are already being raised about the halftruths that the Adanis are spinning.
“How can all Adani sharebacked loans be paid off and then fresh share pledges are created in 2 Adani entities a few hours later. Classic deception. Too much bhang to digest. Or is it okay for @SEBI India?” TMC leader Mahua Mitra tweeted.
Mitra was referring to a media report that said a new lot of shares in Adani Transmission and Adani Green Energy had been pledged with SBICAP Trustee.
SBICap Trustee in notices to stock exchanges on Thursday said that a further 0.99 per cent shares in Adani Green Energy Ltd were pledged “for the benefits of the lenders” of Adani Enterprises Ltd. An additional 0.76 per cent shares in Adani Transmission Ltd were also pledged to banks, the trustee said.
SBICap, which is a unit of State Bank of India (SBI), however, did not give details of the loans taken by Adani Enterprises for which the pledge was created.
With the latest pledge, the total shares in Adani Green Energy Ltd — the group’s renewable energy company — that were encumbered with SBICap was 2 per cent. In the case of Adani Transmission, this came to 1.32 per cent.
The pledge was created a day after Adani group on March 7 said it has repaid Rs 7,374 crore (over $900 million) loans that were taken pledging shares in four group companies in an attempt to allay investor concerns over leverage and debt.
While there was no comments from the Adani group on the latest encumbrance, it may be in the line of a similar pledge announced in February where around 1.48 crore shares in three firms were pledged to backstop an existing loan extended to Adani Enterprises Ltd.
Mixed trend
Shares of Adani Enterprises Ltd (AEL) on Thursday snapped a six-day winning streak as investors chose to book profits from the nearly 70 per cent run in the stock.
The group flagship ended at Rs 1,953.10, a loss of Rs 86.55 or 4.24 per cent over the previous close on the BSE.
Market circles said investors have resorted to profit booking given its sharp runup over the last six sessions and it is likely to consolidate at around these levels.
Apart from AEL, shares of Adani Ports and Special Economic Zone (APSEZ) also ended in the red. However, the other shares who were late to join the rally continued to be on demand.
“Some of the Adani group stocks are still under the five per cent circuit limit, and hence the up-move in these stocks may continue for some more time, while Adani Enterprises and Adani Ports may see some consolidation,” said Deepak Jasani, head of retail research at HDFC Securities.
Kotak exposure
Kotak Mahindra Bank has a “small exposure” to the embattled Adani Group which has been made in line with its credit philosophy, a senior official has said.
Paritosh Kashyap, president and head for wholesale banking, said the issues surrounding Adanis are more of a “capital market and valuations issue and not a credit issue.”
