Adani Informs About Stable Ties With Global Banks To Assuage Investor Worries: Report

Adani Group informed investors that a lot of Japanese and European banks have reaffirmed confidence in the conglomerate after it was pummeled by a U.S. short seller's critical report, news agency Reuters reported citing a company doccument.

In a series of roadshows organized by billionaire Gautam Adani-led conglomerate from Hong Kong to New York held in recent weeks for fixed income investors, the group committed to achieving 20 per cent annual growth in earnings and to diversify its debt portfolio, the document showed.

Global banks such as "MUFG, SMBC, Mizuho, Standard Chartered, Barclays, DBank (Deutsche Bank), consortium lender banks have reaffirmed confidence in Adani group," Reuters reported quoting the document which stated its goal was to assuage investors.

The document, which was reviewed by Reuters, did not elaborate on how the lenders reaffirmed their commitment to the Adani group.

Several of the banks already have business relationships with the group, ties which the conglomerate has previously pointed to as a sign of its strength to counter Hindenburg's allegations.

Mitsubishi UFJ Financial Group Inc (MUFG), Sumitomo Mitsui Financial Group Inc's SMBC unit, Mizuho Financial Group, Standard Chartered and Deutsche Bank did not immediately respond to Reuters querry.

The Hindenburg report, which was published in January, had sparked concern about banks' exposures to the Adani group. Brokerage CLSA estimated in a January 26 report that the consolidated debt of the top five Adani group companies, with some element of double counting, stood at $25.56 billion, with Indian lenders forming 38 per cent of that.

"The group has consistently diversified its long term debt portfolio and has reduced its exposure to banks by using other sources of capital," the document said.

Now, 39 per cent of Adani's debt is currently in the form of bonds, 29 per cent is from global banks and 32 per cent comes from public or private banks in India, the Adani document added.

Adani was forced to shelve a Rs 20,000 crore share sale due to the stock market rout that followed the Hindenburg report in which the short-seller also raised many questions on Adani's debt levels.

The State Bank of India (SBI) and other public sector lenders "have raised no red flags" and were comfortable with its financial position, and lenders "have reaffirmed they will continue to lend to Adani", the document added.