Moody’s Investors Service has revised the ratings of four Adani Group companies to ‘stable’, a year after they were downgraded to ‘negative’ following a report by short-seller Hindenburg Research.
The rating agency has revised the outlook on Adani Green Energy, Adani Green Energy Restricted Group (AGEL – RG-1), Adani Transmission Step-One and Adani Electricity Mumbai, it said in a statement.
Further, Moody’s affirmed a stable rating on another four companies. These are Adani Green Energy Restricted Group (AGELRG-2), Adani Ports and Special Economic Zone (APSEZ), Adani International Container Terminal (AICTPL) and Adani Energy Solutions Limited Restricted Group 1 (AESL RG1).
In February 2023, Moody’s revised the outlook on four rated Adani Group companies to negative, reflecting concerns over their access to capital and a potential increase in capital costs. This followed the release of a report from the short-seller, highlighting concerns over the Adani Group’s governance practices, it said.
This led to significant and rapid declines in the market value of the Adani Group companies’ securities, it added.
In the ensuing period, the group has completed a number of debt transactions, including refinancing as well as obtaining new loan facilities, demonstrating its continued access to debt capital at a reasonable cost. At the same time, several high-profile equity transactions by large institutional and strategic investors, such as GQG and Qatar Investment Authority, also demonstrated the Group’s continued equity market access.
While an investigation by Sebi is still ongoing, the Supreme Court’s decision to entrust the regulator to complete the investigation on the Group and the court’s view that there is no apparent regulatory failure attributable to Sebi have curbed the potential tail risk in a downside scenario, it added.