Four Adani Group stocks hit a lower circuit in the early morning trade on Monday after a ratings outlook cut by Moody’s dampened investors’ sentiment. Adani Green Energy shares were locked in the lower circuit, falling 5% to Rs 687.75 after Moody’s downgraded the company’s outlook to ‘negative’ from ‘stable’. Adani Power shares tanked 5%, trading at Rs 156.10, Adani Transmission was down 5% at Rs 1126.85 and Adani Total Gas fell 5% to Rs 1195.35. On the flip side, Adani Enterprises and Adani Ports and Special Economic Zone shares were up marginally. Meanwhile, BSE Sensex fell 130.01 or 0.21% to 60,552.69 and NSE Nifty 50 dropped 27.25 pts or 0.15% to 17,829.25 with State Bank of India, Infosys and Mahindra & Mahindra leading losses.
The cut in Adani Green Energy Ltd’s outlook to ‘negative’ considers the company’s refinancing needs, huge capital spending program and dependence on sponsor support, potentially in the form of subordinated debt or shareholder loans, which will likely be less certain in the current environment. “The negative outlook also factors in the company’s significant refinancing needs of around $2.7 billion in the fiscal year ending March 2025 and limited headroom in its credit metrics to manage any material increase in funding costs,” Moody’s said in a statement last week.
Adani stocks have been falling since the US-based Hindenburg Research accused the Adani Group of money laundering and stock manipulation. MSCI index last week reduced the quantum of freely tradable shares in its calculation for some of the firms. The MSCI has changed the foreign inclusion factor in Adani Transmission, Adani Total Gas and Adani Enterprises, which could lead to estimated outflows of $416 million in these companies. The MSCI passive trackers will implement changes on February 28.