NEW DELHI: Crisil Ratings has supported the embattled Adani Group, ruling out any credit risks in the medium term. The agency stated that the group has sufficient liquidity and operational cash flows to meet its debt obligations and committed capital expenditures. Crisil also noted that there have been no adverse actions so far by the group’s lenders or investors, despite the U.S. indictment of the group’s founder-chairman, Gautam Adani.
The rating agency highlighted the group’s flexibility to curtail certain discretionary capital expenditures depending on financial market developments and future capital availability. It emphasized that the group’s healthy operating income and cash balance reduce its reliance on external debt to sustain operations.
On November 20, following a complaint by the U.S. Department of Justice and the Securities and Exchange Commission (SEC), the federal court for the Eastern District of New York indicted eight individuals, including chairman Gautam Adani, cousin Sagar Adani, and Vneet Jaain, key executives of Adani Green Energy. They were charged with alleged securities and wire fraud, as well as corruption involving $265 million in bribes to state government officials in India to secure solar power contracts at favorable rates.
The charges also involve alleged violations of SEC guidelines, leading to materially false and misleading statements in the bond offering documents of Adani Green Energy, specifically concerning anti-bribery and anti-corruption policies.
“We have taken note of these developments and their likely impact on the financial flexibility of the group, including the decline in the market capitalization of its listed companies, movement in bond yields, and the withdrawal of the $600-million bond offering by Adani Green Energy,” the agency said on Friday.
Crisil highlighted that the group has steady cash flows, infrastructure assets with long concession periods, and significant cash flow cushions. In some cases, the group also benefits from the additional flexibility afforded by its association with and criticality to the larger Adani Group.
The group reported a robust operating income of Rs 82,917 crore in fiscal 2024, with a net debt-to-operating income ratio of 2.19x. It maintained a cash balance of over Rs 53,000 crore across eight listed entities as of September 2024, compared to long-term debt maturities of Rs 27,500 crore. The group also had go-to-market/construction facilities of Rs 8,919 crore until October of fiscal 2025 and Rs 2,137 crore for fiscal 2026.
According to the report, feedback from management and select lenders indicates that these developments have not yet led to negative actions, such as accelerated debt repayments or spread resets, by lenders or investors.
Crisil further noted that the group retains the flexibility to reduce discretionary capital expenditures based on market conditions and future capital availability. It confirmed that all outstanding ratings remain under continuous surveillance.
However, the report cautioned that any developments restricting the group’s access to domestic and international capital or hampering its ability to refinance upcoming bullet repayments, along with a significant increase in financing costs, will be key areas of concern to monitor.