New Delhi, Feb 28 () The Adani Group is a portfolio of businesses with strong fundamentals and robust assets. Over the years, it has consistently reported excellent financial and operational performance.
Senior leaders and captains of industry came forward to reassure the country that India’s financial sector is robust and well managed. They warned investors not to trust those who questioned India’s ability to govern.
Finance Minister Nirmala Sitharaman described India as a “very well regulated financial market”.
Quoting senior management of LIC and SBI, it assured investors that the two institutions are not overly exposed to Adani Group stocks.
“They have made it very clear that their exposure (to Adani Group) is very well within permissible limits and with the value going down, they are still above profit. That’s the word from the horse’s mouth,” she said.
The Reserve Bank of India (RBI) has ended concerns over PSU banks’ exposure to the Adani Group. The RBI said the “banking sector remains resilient and stable”.
It added that, as a regulator and supervisor, the RBI maintains constant vigilance on the banking sector and individual banks in order to maintain financial stability.
RBI Deputy Governor MK Jain then said banks’ exposure to the Adani Group was “not very significant” and also that the exposure to Adani companies’ shares was “insignificant”.
He added, “Domestic banks’ exposure is against fixed assets, operating cash flows, ongoing projects and is not based on market cap.”
Former SEBI CEO J.
“In my opinion, the Hindenburg report is not the gospel truth,” he said.
Explaining the motive behind Hindenburg’s action, he added, “A report can be called credible if there is no motive attached to it. In the present case, there appear to be two motives. One, clearly stated that they have a short view. The other is an indirect motive, aimed at inflicting maximum damage on Adani Group shares, once again to further their short-selling motive.”
In a move that will further boost market confidence in the Adani Group’s strong fundamentals, Devendra Fadnavis, Deputy Chief Minister of Maharashtra, said the state will soon issue a Cabinet Resolution (GR) formally awarding the Dharavi redevelopment project to the Group. Adani.
“Several nits need to be worked out before the GR is issued.” It will be done very soon,” he said.
In the south, the Government of Kerala has agreed to provide Rs 400 crore to Adani Ports when 30 per cent of the breakwater construction at Vizhinyam Port is completed. As the work accelerates, the state government is working to raise the necessary funds.
SBI chairman Dinesh Kara said the bank has not sanctioned any loans against shares of Adani Group companies, demystifying the state-owned lender’s exposure to Adani Group shares.
He said: “The share price will not affect our loans. “It’s all against assets that generate cash and have an excellent repayment track record.”
He added that SBI’s exposure to the Adani Group is around Rs 27,000 crore or 0.8 to 0.9 per cent of its loan book. He also said that SBI does not see any challenges in loan servicing.
“We have lent to Adani for projects that have tangible assets and have adequate cash collection. They are able to fulfill their obligations.”
LIC CEO Siddhartha Mohanty is bullish on Adani’s stock. He said all LIC investments were made in accordance with the company’s standard operating procedures.
DBS Bank, one of Singapore’s “Big Three” banks, has also thrown its weight behind the Adani Group.
Referring to the Adani portfolio of companies, Piyush Gupta, CEO of DBS, said, “They are solid cash-generating companies. So we’re not worried about the exposure.”
Southeast Asia’s largest bank sees “tremendous potential” in the cement industry and is confident that the bank’s exposure is “pretty tightly managed.” DBS provided $750 million to the Adani Group during last year’s acquisition of Holcim’s cement business in India.
Describing the investments in the Adani Group’s gas and renewable energy businesses as “sound”, Patrick Poujan, CEO of TotalEnergies, said: “These companies [ATGL & AGEL] they have assets and income. Adani Green is still worth twice what we invested. Adani Gas is still worth eight times more. Our accounting is sound, there was due diligence before and due diligence afterwards.”
Underscoring the importance of the Adani Group’s green energy initiatives, Erik Solheim, a prominent green activist, diplomat and former Norwegian climate change minister, expressed solidarity with the business group and tweeted: “Adani has been under heavy attack for the past few weeks. . It is very important to know the answer of Adani. Adani Green is the most important company for India’s green future.”
Addressing concerns over Adani’s stock valuation, Prakash Kacholia, MD, Emkay Global Financial Services, said the medium-term implications of the allegations against the Adani Group are unlikely to be significant.
“Although we are not forensic accountants, almost all of Adani Group’s major assets are in ports, airports, power and transmission and roads, where returns are regulated and unit numbers are reported to various regulatory bodies,” he said.
Unfavorable suggestions that banks in India would lend to Adani Group “on instructions from higher-ups”, DLF chairman KP Singh said the turmoil engulfing Adani Group following allegations made by the US short-term seller had not shaken faith in global investors in India.
Uday Kotak, chairman of Kotak Mahindra Bank, said he “does not see a systemic risk to the Indian financial system”.
He added that “major Indian corporations relying more on global sources of debt and equity financing are creating challenges and vulnerabilities, and it is time to further strengthen Indian underwriting and capacity building.”
Sanjiv Chadha, MD and CEO of Bank of Baroda, said the bank will continue to lend to the Adani Group.
In another statement, he said the Bank of Baroda is ready to consider lending additional money to the Adani Group, including for the remodeling of the Dharavi Redevelopment Project.
“You have underwriting standards and you stick to them in good times and bad,” Chadha said, adding that he was not worried about the market volatility surrounding Adani’s stock.
Goldman Sachs said Adani Ports’ debt is well capitalized with cash on hand, while sufficiently liquid for trading. It also expects the company to be able to refinance its bonds while also being able to attract equity investors and sell assets.
Credit rating agency Fitch Ratings also dismissed concerns about Adani Group companies, saying there was no immediate impact on the ratings of Fitch-rated Adani entities and their securities.
Fitch added that it does not expect material changes in forecasted cash flows and informed that there are also no short-term significant maturities of offshore bonds, which reduces refinancing risks and short-term liquidity risks.
Later, the agency also said Indian banks’ exposure to the Adani Group was insufficient to pose a significant risk to the banks’ standalone credit profiles. It added that it believes the economic and sovereign implications of the Adani controversy remain limited.
Moody’s noted that the credit ratings for Adani Ports and Special Economic Zone Ltd, Adani Green Energy Ltd and Adani Transmission Ltd are underpinned by their regulated infrastructure businesses with long-term sales contracts, or their strong operating cash flows and dominant market position.
Dismissing concerns over Adani Group’s debt quality, financial services major JP Morgan Chase said Adani Group companies remain eligible for inclusion in the CEMBI, JACI and JESG indices, as per current index rules. In addition to CEMBI and JACI, Adani’s dollar bonds remain eligible to be part of JP Morgan’s ESG Global Corporate Index (JESG).
Echoing the sentiments of industry leaders, Anand Mahindra, Chairman, Mahindra Group, said, “The global media is speculating whether the current challenges in the business sector will derail India’s ambitions to be a global economic powerhouse. I’ve lived long enough to see us face earthquakes, droughts, recessions, wars, terrorist attacks. All I will say is: never, ever bet against India.”
Former Solicitor General Harish Salve, one of India’s leading legal minds, said, “No one is happy that Indian businessmen are making their presence felt globally.”
He said the charges against the Adani Group are a major attack on India and Indians, adding that most of Adani’s assets are regulated. Salve also said that the records of Adani Group companies are in the public domain, and for anyone to say that they have done any hidden research is “all nonsense”.
The Financial Services Commission of Mauritius has not found any breach of the law by companies and funds linked to the Adani Group, according to its CEO Daneswornath Vikash Thakur.
“Based on the submissions we have received so far regarding what they are required to do, we have not found any violation of the law, notwithstanding the fact that a number of these entities were also subject to our routine on-site inspection under our cycle. ” said the head of Mauritius’ securities market regulator.
Refuting the allegations leveled by Rahul Gandhi that the Mumbai airport was taken over from the GVK Group by the Adani Group, GVK Vice Chairman Sanjay Reddy said the offer by the Adani Group was a welcome relief for the then debt-ridden GVK Group. . pressure.
He also revealed that the chairman of the Adani Group was willing to close the transaction very quickly to help the GVK Group meet its repayments.
(This story was not edited by Kashmir Monitor staff and was automatically generated from a syndicated feed)