Adani companies on a stronger footing: Bernstein
Adani Group, currently facing impropriety allegations involving one entity of its diversified business empire, is now on a stronger footing than when the to-date unproven charges by US short-seller Hindenburg dramatically shrank the conglomerate's market value early 2023, global brokerage Bernstein said, citing both operating and financing metrics.
The brokerage referred to a lower quantum of pledged shares, stronger debt coverage ability, and better relative valuations for some of the companies to justify its current assessment of the group, after billionaire founder Gautam Adani and his nephew Sagar Adani were indicted late November on alleged impropriety charges by the US Department of Justice.
Bernstein covers three of the group's listed companies — Ambuja Cement, Adani Ports and Special Economic Zone and Adani Green Energy. The brokerage has not changed its rating for these shares after the US regulatory indictment.
While the overall debt of the Adani Group at ₹2.79 lakh crore is higher than the ₹2.41 lakh crore as of March 2023, group's net debt-to-EBITDA ratio — a debt servicing metric relative to operating profit — has seen a sharp drop.
The group also has higher cash reserves of ₹39,000 crore at the end of September, as against ₹22,300 crore as of March last year, said the brokerage.
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