Sell-off in Adani shares may hit group’s ability to raise debt: Moody’s

“These adverse developments are likely to reduce the group’s ability to raise capital to fund committed capex or refinance maturing debt over the next 1-2 years. We recognise that a portion of the capex is deferrable, and the rated entities do not have significant maturing debt until FY2025,” Moody’s said in a statement.

Moody’s said that it has not revised its ratings for Adani Green Energy, Adani Transmission, or Adani Ports and Special Economic Zone.

“Given the significant and rapid decline in the market equity values of the Adani Group companies following the recent release of a short-seller report highlighting governance concerns, our immediate focus is primarily on assessing the rated entities’ overall financial flexibility, including their liquidity position and access to funding to support refinancing and ongoing growth initiatives,” Moody’s said.

“Nevertheless, these adverse developments are likely to reduce the group’s ability to raise capital to fund committed capex or refinance maturing debt over the next 1-2 years. We recognise that a portion of the capex is deferrable, and the rated entities do not have significant maturing debt until FY2025,” Moody’s added.

Additionally, Fitch Ratings stated that it did not anticipate any significant revisions to the cash flow outlook for Adani Group. Eight companies in the Adani group, including Adani Transmission Ltd, Adani Electricity Mumbai Ltd, and Adani International Container Terminal, hold ratings from Fitch.

“Our ongoing monitoring will be looking closely at any major changes to the rated entities’ access to financing or cost of financing on a long-term basis, unfavourable regulatory/legal developments or ESG-related matters that could affect credit profiles,” said Fitch in a report.

There were no significant offshore bonds maturing in the near term, reducing refinancing risks and near-term liquidity risks, Fitch further added.

(With inputs from agencies)