Adani Group says it completed $2.65-billion deleveraging programme Adani Group says it completed $2.65-billion deleveraging programme Adani Group says it completed $2.65-billion deleveraging programme Gautam Adani-led Adani Group on Monday said it has repaid loans aggregating $2.65 billion to complete a prepayment programme to cut overall leverage as it attempts to win back investor trust post a damning report by US short seller Hindenburg Research.
Cash balance at listed portfolio is now over higher by 41.5% at $4.75 billion, or Rs 40,351 crore, said the conglomerate as part of its credit update for FY23.
“The deleveraging programme testifies the strong liquidity management and capital access at sponsor level even in volatile market condition, supplementing the solid capital prudency adopted at all portfolio companies,” said the Adani Group in the credit update.
In a credit note released on Monday, Adani Group said it has made a full prepayment of $2.15 billion of loans that were taken by pledging shares in the conglomerate's listed firms before March 12, well in advance of March 31 deadline, and also another $700 million in loans taken for the acquisition of Ambuja Cements Ltd.
''The prepayment was done along with interest payment of $203 million,'' it added.
Further, the credit update stated that the promoters completed the sale of shares in four listed group entities to GQG Partners, a leading global investment firm, for $1.87 billion (Rs 15,446 crore).
US short-seller Hindenburg Research, in January, released a damning report alleging accounting fraud and stock price manipulation at Adani Group, triggering a stock market rout that had erased about $145 billion in the conglomerate's market value at its lowest point.
Adani Group has denied all allegations by Hindenburg and has been plotting a comeback strategy. The group has recast its ambitions as well as prepaid some loans to assuage investors. Last month, Adani Enterprises Ltd and Adani Transmission Ltd said they will together Rs 21,000 crore through share sale.
The credit update further highlighted major improvements in key financial metrics - the portfolio's combined net debt to EBITDA ratio has decreased from 3.81 in FY22 to 3.27 in FY23, run rate EBITDA surged from Rs 50,706 crore in FY22 to Rs 66,566 crore in FY23.
The credit update further stated that the banking lines of Adani Group continue to show confidence by disbursing new debt and rolling over existing lines of credit. Moreover, rating agencies, both domestic and international rating ones, have reaffirmed their ratings in all the group companies.
Debt Service Cover Ratio (DSCR) has improved to 2.02x during FY23 from 1.47x during FY22. Gross Assets increased to Rs 4.23 lakh crore, up by Rs 1.06 lakh crore. Gross Asset / Net Debt cover has improved to 2.26x in FY23 from 1.98x in FY22.
Continued investments in core infra with gross assets of Rs 3.77 lakh crore (89 per cent of the portfolio) provide long-term multi-decadal visibility of cash flow, it said, adding cash balance was higher by 41.5 per cent at Rs 40,351 crore against Rs 28,519 crore. Free Flow from operations – FFO - (EBITDA less finance cost less tax paid) was Rs 37,538 crore.
Cash Balance and FFO (together at Rs 77,889 crore) are much higher than debt maturity cover for FY24, FY25 and FY26 of Rs 11,796 crore, Rs 32,373 crore and Rs 16,614 crore, respectively, at the combined portfolio level.