Hindenburg effect: Adani reportedly suspends Mundra petchem work to win back investors

Feb 27, 2023

By: Rounak Jain

Adani’s comeback strategy

The Adani group has undertaken several measures – from loan repayments and letting acquisitions lapse to cancelling a follow-on public offer (FPO) – to win back investor confidence following the damage caused by the Hindenburg report’s allegations of stock manipulation and fraud against the group. Here’s everything the group has done to shore up confidence since then.

Credit: BCCL

Adani suspends work on ₹34,900 crore Mundra petchem project

The Adani group has suspended work on its ₹34,900 crore Mundra petrochemical project, with the focus now on consolidating operations, according to a report by PTI on March 19.

Credit: Unsplash

Repayment of $2.65 billion worth loans

The promoter family has repaid $2.15 billion worth of share-backed loans on March 12, along with a $500 million financing facility taken for the Ambuja Cements acquisition.

Credit: Canva

‘Not morally correct’

It all started with Gautam Adani withdrawing Adani Enterprises’ ₹20,000 crore follow-on public offer (FPO) on February 1, saying it would not be morally correct to go ahead with the FPO – in spite of it being fully subscribed – after the stock price crashed in the aftermath of the Hindenburg report.

Credit: Adani-Enterprises

Bond payments made on time

A Reuters report on February 3 stated that the Adani group made its scheduled US bond payments on time, after multiple Adani group bonds hit distressed levels. An earlier report had said that the interest payments due stood at $24 million.

Credit: Canva

$1.1 billion to release pledged shares

The group promoters prepaid $1.1 billion on February 7 to release pledged shares in three group entities — Adani Ports & SEZ, Adani Green Energy, and Adani Transmission.

Credit: Canva

Pulls the plug on DB Power acquisition

The Adani group called off its ₹7,017 crore acquisition of DB Power. Group officials said they want to complete existing projects first before committing fresh capital expenditure.

Credit: Adani-Power

Repays ₹1,500 crore loan to SBI MF

Adani Ports & SEZ announced the repayment of a ₹1,500 crore loan to SBI Mutual Fund on February 20, and also said it will repay another ₹1,000 crore of commercial papers falling due in March.

Credit: Adani-Ports

To repay ₹5,000 crore in debt

Adani Ports & SEZ announced that it will repay debt worth ₹5,000 crore in FY24.

Credit: Canva

Adani Green puts ₹10,000 crore capex plans under review

Adani Green Energy announced in its Q3 earnings that it has put its ₹10,000 crore capital expenditure plans under review.

Credit: Canva

Total debt at ₹2.22 lakh crore

At the end of FY22, Adani group’s cumulative debt stood at ₹2.22 lakh crore, and Indian banks’ exposure to the group stood at ₹81,200 crore.

Credit: Canva

Adani group’s market capitalisation falls by over ₹11 lakh crore

Since the Hindenburg report was released on January 24, the Adani group’s combined market capitalisation has fallen by ₹11.48 lakh crore to ₹10.46 lakh crore on March 20.

Credit: BCCL

Gautam Adani falls from third to 21st richest billionaire

Gautam Adani fell from the third richest to the 21st richest in the world, with his wealth falling from $119 billion on January 24 to $57.5 billion on March 19.

Credit: BCCL

US stock market update: S&P 500 hits 4-day losing streak as tech stocks weigh down market