Adani Group seeking more time to repay loans related to ACC and Ambuja Cement: Report

The Adani group is seeking some more time to repay the loans related to its cement companies – Ambuja Cement and ACC. The Economic Times newspaper, citing sources, has reported that the Gautam Adani-led firm wants to renegotiate the terms of the outstanding loan, which is worth $4 billion.

The newspaper has written that Adani Group had taken this loan from Holcim Group of Switzerland in August last year. The group has started talks with lenders to extend the term of the $3 billion bridge loan. It is expected that this tenure may be extended from the current 18 months to a period of five years or more.

According to the report, the Adani group will take out another $1 billion mezzanine loan (a mix of debt and equity financing that gives the lender the right to convert debt into equity interest in case of default), Whose present repayment period is 24 months, is seeking to be converted into Senior Security Loan, thereby increasing its tenure to 5 years.

News agency Reuters has reported that on the day of publication of this news report, the shares of Adani Group saw a decline. Media reports said that ‘all 10 stocks of Adani Group were trading in decline on Tuesday, out of which four – Adani Power, Adani Transmission, Adani Green and Adani Total Gas – did relatively worse.’ was called the ‘worst performer’ in the market.

Significantly, at the end of January, American investment research firm Hindenburg Research, in one of its reports, accused the Adani Group of fraud, after which the shares of the group’s companies saw a steep decline. In this report, it was said that a two-year investigation has revealed that the Adani group has been involved in ‘stock manipulation and accounting fraud’ for decades.

After this, the Adani group suffered a loss of about $ 100 billion in market capitalization. The Adani Group has denied any wrongdoing and all allegations of fraud.

Analyst Alam Srinivas writes that the debt burden will not go away from Adani’s head. Some experts believe that the group’s credit risk is still high. He calls it an ‘untenable debt situation’ and says that ‘the group still needs cash flow.’

On the recent purchase of Adani shares worth $1.9 billion in a day by GQG Partners, an American company with assets of more than $90 billion, analysts say that ‘GQG bought shares from Adani’s private funds and not from the market. So this purchase enabled Adani to reduce his stake in four companies.

The analyst writes, ‘This is significant in view of one of the main allegations made by Hindenburg.’ Significantly, the main allegation of Hindenburg Research is that it traced companies in tax haven countries, “which had major stakes in listed Adani firms and were related to Vinod, brother of Gautam Adani”.

But as these facts were not disclosed, promoters’ holding in many listed companies had actually exceeded the legal limit of 75 per cent. If the investigation reveals that these entities are related to Adani, it could spell trouble for the Adani group.