Why did Adani Group’s global lending rate drop? Know who is lending money now
Gyaneshwar Dayal December 26,2024
Between the Adani Group being embroiled in the Hindenburg report first and now the US indictment, the group’s borrowings from international institutions have been greatly affected. In the first half of this financial year, the borrowings from global institutions have decreased, while the loans it receives at the domestic level have increased. In this too, the loans from Indian banks have increased significantly.
In a way, it can be said that the borrowings of the group have now shifted from international to domestic. According to a TOI report, the risk of domestic banks and financial institutions in the Adani Group increased from Rs 70213 crore in March 2024 to Rs 107985 crore by September 2024. That is, there has been an increase of about 53%.
During this period, due to reduced borrowing from global institutions and international markets, total debt increased by 13.6% and it increased from Rs 2,27,248 crore in March 2023 to Rs 2,58,276 crore in September 2024. However, the group’s assets have grown very rapidly during this period.
The share of domestic banks in the group’s financial debt increased from 31% in March 2023 to 42% by September 2024, while the share of global institutions decreased slightly from 28% to 27%. Capital market borrowing declined from 37.1% to 29% in March. The exposure of public sector banks increased by 50 per cent from Rs 31609 crore to Rs 47435 crore. This is 18 per cent of the total debt. The share of private banks and finance companies increased from 17 per cent to 23 per cent.
According to the report of the English newspaper, however, the total wealth of the group increased to Rs 5.5 lakh crore after investing Rs 75277 crore in the first half of this financial year. Adani Enterprises saw an increase in wealth in businesses such as Navi Mumbai Airport and solar modules, where sales grew 91 percent to 2,380 megawatts. Adani Green Energy started work on a 500 megawatt hydro pump storage project, increasing operating capacity by 34% to 11.2 gigawatts.
By the way, the Adani Group has been in the headlines continuously for more than a year. Last month, Gautam Adani has been accused in the US of planning to bribe Indian officials with crores of rupees to get a big power project in India.
However, the Adani Group has rejected the allegations and said that the matter will be dealt with legally. A Reuters report said that arrest warrants were issued in the United States for Gautam Adani and his nephew Sagar Adani. This happened when a grand jury in New York on Wednesday, November 20, charged Adani and seven others with a bribery scheme. However, the Adani Group has completely rejected these allegations of America and said that the Adani Group has nothing to do with the allegations made.
Earlier, in a report dated January 24 last year, Hindenburg Research accused the Adani Group of stock manipulation and accounting fraud. The report said that in its research, it spoke to dozens of individuals, including former senior officials of the Adani Group, examined thousands of documents and visited sites in about half a dozen countries to investigate it.
Hindenburg is a US-based investment research firm that specializes in activist short-selling. The research firm had said that its two-year investigation revealed that the Adani Group was involved in stock manipulation and accounting fraud worth Rs 17.8 trillion (US$218 billion) for decades. The Adani Group rejected Hindenburg’s report and said that such allegations were made against the group to make profits by short selling.
However, both these big allegations had a bad effect on the company’s shares and investors. During both these developments, the share prices of Adani Group companies fell sharply. It was said that during this time foreign investors started withdrawing money. However, the company has also taken several steps to maintain the confidence of investors.
