Adani Group claims enough cash and profit to repay debt in coming decade

By PR Sanjay and Divya Patil

The Adani Group said the cash and profit generated from its vast infrastructure business could cover all the debt maturing each year over the coming decade, as billionaire Gautam Adani prepares to submit findings of an investigation into the group by India’s market regulator. Trying to restore investor confidence a few days ago. alleged wrongdoing.

In a credit report released on Thursday, the power-to-port group said cash flow generated from business operations and balances stood at 778.9 billion rupees ($9.4 billion) as of the end of March. This provides the company with sufficient liquidity to cover debts maturing within one year.

About 60% of its debt was from banks, while the rest was bonds raised from India and overseas markets. International lenders increased their share in Adani’s total bank loans to 28% from 18% a year ago. The group’s total debt stood at Rs 2.3 trillion at the end of March, up from Rs 1.89 trillion a year ago.

On Wednesday, the group said it posted record profit in the quarter ended June on the back of its infrastructure and renewable energy businesses.

Debt Maturity Profile of Adani Group

The strong cash position and bumper earnings performance underscored the beleaguered conglomerate’s continued efforts to recover from the damaging short seller report released in January by Hindenburg Research. The US short seller accused the company of massive corporate impropriety – an allegation that at one point wiped off more than $150 billion in value from its listed companies, but which Adani has also vehemently denied.

The company’s improved debt servicing capabilities were revealed at a time when investors await the findings of the Securities and Exchange Board of India, the Indian market watchdog, which has looked into some of the allegations made by Hindenburg. SEBI has sought an extension from the country’s Supreme Court to complete its probe till the end of August.

Other Key Features from the Credit Report

Around 64% of total term loans have a leverage ratio in the range 0x – 3.0x

86% of overall EBITDA is contributed by infrastructure businesses including energy & utility and transportation & logistics verticals

Cash at June 30 stood at Rs 421.15 billion, up from Rs 17.64 billion in the previous quarter.

Adani portfolio companies reported EBITDA CAGR of 23.16% over last five years