Adani Group stocks witnessed trend reversal on Tuesday, with seven of nine listed entities floating in positive terrain amid a report that the Gautam Adani-led conglomerate is planning to prepay or repay share-backed loans worth $690 million to $790 million by March end. The port-to-power group has repaid more than ₹12,000 crore over the last few days, which includes ₹9,500 crore to bondholders, ₹1,000 crore to SBI Mutual Fund, and ₹500 crore to Aditya Birla Sun Life Mutual Fund against commercial papers that matured last week. Besides, the group plans to repay another ₹1,200-1,400 crore to SBI MF against commercial papers maturing in March.
Shares of Adani group companies have been under stress since January 24 and lost around ₹12 lakh crore in cumulative market value after Hindenburg Research released a report, accusing the conglomerate of “brazen stock manipulation".
Adani stocks got a lift on Tuesday amid a report that the group looks to prepay loans to improve its credit profile, which may ease investors' concerns about the conglomerate’s debt levels and repayment capabilities. The plans were presented by the Adani management to the group’s bondholders in Hong Kong on Tuesday, as per a Reuters report. The group is yet to release an official statement on its debt repayment plans. The management, however, has refuted a February 27 report, which claimed the group was looking to raise debt against shares of a key Australian asset.
The broad-based rally in Adani Group stocks was further boosted by a report by corporate governance research firm SES, which claimed the group’s debt concept concern may be overstated since each business appears to be independently resilient to muster required cashflows to service debt. Stakeholders Empowerment Services (SES), in its report, said Adani must care for its stakeholders (investors and lenders) and address all areas of concern. “An independent third party confirmation of its accounts would go a long way in establishing and restoring credibility,” the report noted.
At 2:30 pm, Adani Group stocks were mostly trading near their day’s high, led by Adani Enterprises, which rallied nearly 19%. Adani Enterprises, the flagship company of Adani Group, jumped as much as 19.1%, followed by Adani Green Energy, Adani Ports & SEZ, Adani Power, and Adani Wilmar, which touched their 5% upper circuit limit. The newly acquired cement entities Ambuja Cement and ACC climbed as much as 7% and 4.65%, respectively, during the session so far.
Bucking the trend, Adani Total Gas and Adani Transmission were locked in their 5% lower circuits on the BSE. Both the stocks touched their fresh 52-week lows and plunged nearly 80% in more than a month amid fear about the group’s debt levels amidst the report by the U.S.-based investment firm Hindenburg Research. In the selloff that began on January 24, Adani group stocks suffered a cumulative loss of more than ₹12 lakh crore in the last twenty three sessions, from ₹19.18 lakh crore to ₹7.1 lakh crore as of today.