April 8, 2025 11:10:16 AM

The analysts have noted that even though the group’s debt levels may have increased, its cash flows have progressively increased as additional assets have come online and started to function.
Research indicates that the conglomerate’s debt is likely to rise by another Rs 40,000 crore, totalling more than Rs 2.6 trillion, as a result of the Adani Group’s recent acquisition of cement maker Holcim’s India business. As a result of the expansion of the port industry, investments in renewable energy, acquisition of the transmission industry, and ventures into more recent industries such as airports, roads, and data centres (Adani Enterprises), the debt levels of the Gautam Adani-led Group have increased from Rs 1 trillion to Rs 2.2 trillion over the last five years.
The business has managed to diversify its debt in favour of bonds and financial institution (FI) loans with longer maturity tenors, analysts at Credit Suisse highlighted, even if the gross debt levels may have increased.
Only 26% of the debt is due to mature in less than five years, they said, down from around 86% at the end of FY16 (when there was Rs 1 trillion in debt).
Around 30% of the total debt is in foreign currencies, in terms of value. In addition, while the actual amount of Indian banks‘ loans to Adani has been consistent over the past five years, their proportion of the group’s overall debt has drastically decreased to barely 18 per cent. The group’s cash flows have continually improved as new assets have come online and begun to function, the analysts have remarked, despite the fact that the group’s debt levels may have climbed.
As a consequence, the group-level net debt ratio has dropped to about 5 times in FY22 from less than 7.5 times in FY16. Additionally, the group’s interest coverage has increased from 0.9 times in FY16 to more than twice as much as it is now.
Due to their sustained investments, the majority of group firms’ debt levels increased overall in FY22. Except for Adani Transmission, the interest cover for these firms has stayed consistent despite their operations being better. The operationalization of assets at Adani Green improved significantly, and as a result, the company’s capacity to pay interest on its debt has not been adversely affected.
An analyst at Nomura Holdings in Hong Kong recently predicted that Adani Green Energy’s debt-to-capital ratio would decline. Adani Green Energy would receive $500 million from the International Holding Co (IHC), situated in Abu Dhabi. By stabilizing the debt-to-capital ratio in the low 60 per cent area from 95.3% at the end of March, the equity injection will assist the firm.
The analyst said that the backing from IHC “will be apparent when the firm discloses its second quarter balance sheet figures,” adding that the inflow of capital demonstrates Adani Green’s capacity to obtain money through stock. In three businesses controlled by Gautam Adani, IHC has invested nearly $2 billion. A total of $70 billion will be invested by the Adani group across the whole green energy value chain by 2030.
The analyst acknowledged that Adani group’s rapid expansion is a “negative overhang for credit investors since much of the M&A recently has been debt-funded,” but he also pointed out that the conglomerate has shown adept at securing outside investors to support finance.
The Adani group has dominated the Indian market for the previous five years. In addition to operating the largest private port in the country, the Adani company also mines coal, produces private electricity, distributes city gas, and imports edible oils. Airports, urban planning, loans to small and medium-sized enterprises, electricity transmission and distribution, data centres, and many more facilities have all seen growth at the corporation.
SBI gave the Adani group a loan in the sum of Rs. 12,770 crores in March of this year to help with the planning of a new international airport in Navi Mumbai. Several subsidiaries of the group secured the loan.
Sources claim that Mundra will soon have a new facility that will make polyvinyl chloride (PVC) from coal. The project would be a part of even the Adani Group’s aim to establish a petrochemical hub in Mundra.
Operating profits of Rs 20,141 crore and total yearly revenues of Rs 77,000 crore were recorded in 2017–18 by six publicly listed companies controlled by the Adani Group. After interest, tax, and other costs are subtracted, the company’s expected earnings total Rs 3455.34 crore.
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