India’s Adani Group has said it has enough cash flow to cover debt obligations, seeking to reassure creditors after US prosecutors indicted billionaire founder Gautam Adani for fraud, sparking a sell-off in the conglomerate’s stocks and bonds, according to a 25 November Business Standard report.
On 20 November, criminal charges were filed against Adani and other senior executives, alleging that they had been involved in a US$265M bribery scheme to win contracts for Adani’s renewable energy company, expected to yield more than US$2bn in profits over 20 years, the BBC reported on the same day.
The Adani Group dismissed the allegations as baseless and said it would seek all possible legal recourse, Business Standard wrote.
“The Adani Group has always upheld and is steadfastly committed to maintaining the highest standards of governance, transparency and regulatory compliance across all jurisdictions of its operations,” it said in a statement.
Following the US Department of Justice criminal indictment and US Securities and Exchange Commission civil complaint, the group’s market value dropped by almost US$27bn at one point, while its dollar bonds had declined and one of its entities had been forced to cancel a US$600M bond offering, Business Standard wrote.
However, the group said 62% of its total revenue and 84% of earnings before interest, tax, depreciation and amortization (EBITA) were derived from its core infrastructure business.
Cash balances exceeded long-term debt repayments for the next 28 months, while portfolio level cash balances totalled US$6.33bn, according to a company report for the first six months of the financial year ending March 2025 published on 25 November, the report said.
An Indian multinational conglomerate founded by Gautam Adani in 1988 as a commodity trading business, Adani Group’s businesses include food and beverage conglomerate Adani Wilmar as well as subsidiaries in sea and airport management, electricity generation, transmission, mining, natural gas, food, weapons and infrastructure.
Adani Wilmar is a joint venture between Adani Enterprises and Wilmar International and supplies a range of edible oils, vanaspati, speciality fats and oleo chemicals.
The company’s edible oil products include soyabean oil, palm oil, sunflower oil, rice bran oil, mustard oil, groundnut oil, cottonseed oil and blended oil.
In 2023, the Adani Group had also faced a crisis following the publication of a report by Hindenburg Research, which claimed the company had manipulated its stock price and committed accounting fraud, claims which the company had strongly denied, Business Standard wrote.
