Adani Group’s crisis averted! Rating agencies, banks and foreign partners gave such support
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New Delhi : The crisis looming over Adani Group now seems to be averted. After the turmoil in the shares of Adani Group companies after the report of American short selling firm Hindenburg Research, rating agencies, banks and its partners have supported in a tremendous way. After coming with all this, the ongoing decline in the shares of Adani Group companies suddenly stopped till Friday evening and then they became stable. During Friday’s trading, the shares of some companies of Adani Group were about to hit the lower circuit.
S&P Global Ratings maintains credit rating
According to media reports, US-based rating agency S&P Global Ratings on Friday retained the outlook on Adani Ports and Adani Electricity from stable to negative while maintaining the credit rating of both the companies. Hindenburg Research in its report has alleged a lot of irregularities in Adani Group at the level of company operations. After this report, there has been a sharp decline in the shares of the group companies. This has also affected the bond prices and yields of group companies.
Rating outlook for Adani Electricity and Adani Ports negative
S&P said in a statement that there are concerns among investors about the group’s operations and disclosure levels. The concern is much bigger than what we’ve looked at in our ratings, and it’s a risk. Fresh scrutiny and negative market sentiment could increase the cost of capital and reduce access to finance for rated units. In view of all this, the rating outlook for Adani Electricity and Adani Ports has been changed from stable to negative, he said.
Adani Enterprises shares fell by 35 percent
Let us tell that for the first time after January 24, the shares of Adani Enterprises, the flagship firm of Adani Group, closed with an increase. However, the company’s shares had fallen by 35 per cent in the day’s trading. Adani Ports and SEZ also closed with a gain of eight per cent. Since the allegations were made in the Hindenburg Research report, the shares of the group’s companies registered a steady decline.
French company Total Energies supported
French energy giant TotalEnergies, which holds stake in two Adani group companies, on Friday said it has not re-evaluated its stake amid a sharp fall in the group’s shares. TotalEnergies said in a statement that it had made its investment in Adani Group companies in full compliance with Indian laws and based on its internal operating procedures.
Moody’s Investors Service assessing the Group’s financial position
At the same time, Moody’s Investors Service said that it is assessing the financial strength of Adani Group companies including their cash position. Another rating agency Fitch said that its rating regarding the companies of the group will not be affected. However, US-based rating agency S&P Global Ratings has upgraded Adani Ports and Adani Electricity to negative from stable while maintaining their outlook on Adani Ports and Adani Electricity.
RBI’s eye on the person who gave loan to Adani Group
The Reserve Bank of India (RBI) said that India’s banking sector is strong and stable. The central bank also said that it is constantly monitoring the lenders. The RBI said in a statement that it continues to monitor the banking sector, taking note of media reports raising concerns about the exposure of Indian banks to a ‘professional group’. However, the RBI did not name the Adani group.
SBI gave loan of Rs 27,000 crore
The country’s largest lender State Bank of India (SBI) said that it has given loans of about Rs 27,000 crore to Adani Group companies, which is only 0.88 per cent of the total loans disbursed. At the same time, public sector Bank of Baroda said that it has cut loans to companies of the troubled Adani Group in the last two years and has no concerns about the quality of the outstanding loans.
Opposition attacks on the government
At the same time, 15 opposition parties, including the Congress, are continuously attacking the government regarding the issue of Adani Group. The Congress has demanded an inquiry into the matter under the supervision of the Supreme Court and the Joint Parliamentary Committee (JPC). The opposition said that they will continue to raise the demand for discussion and investigation in both the Houses of Parliament on the matter related to the allegations made by ‘Hindenburg Research’ against the Adani Group.
Congress held a meeting
Congress, DMK, Aam Aadmi Party, Bharat Rashtra Samithi, Samajwadi Party, Nationalist Congress Party, Janata Dal (United) and many other parties in the meeting of 16 parties in the Chamber of Parliament House of Leader of Opposition in Rajya Sabha and Congress President Mallikarjun Kharge. leaders joined in. The Communist Party of India (CPI) will hold a demonstration on February 13 demanding an inquiry by the Joint Parliamentary Committee (JPC) into the matter related to the Adani Group.
Regulatory system has no opinion on Adani crisis: Sitharaman
On the other hand, Finance Minister Nirmala Sitharaman told in an interview to news channel News18 that the Adani incident does not create any opinion about the Indian regulatory system and the financial markets are operating well. At the same time, Finance Secretary TV Somanathan said that the uproar in the stock market due to the huge fall in Adani Group’s shares is just a ‘storm in a teacup’ from the macro-economic point of view. ‘A storm in a tea cup’ is an idiom which means to show anger and concern over a matter which is not important.
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