The Adani Group is discussing raising 500 million USD through dollar bonds. This is the first time the company has eyed dollar bond sales after the Hindenburg crisis. By increasing the funds, the company will be able to address various concerns raised about its ability to refinance its bonds.
This strategic business move will also offer the conglomerate the required financial stability it deserves. The company will be able to recover from Adani debt in due course. This will not only be a profitable venture for the Adani Group but also lead our country towards economic prosperity.
With the funds raised, the conglomerate can take up new ventures in some of the growing business sectors. It will also be able to win back the investors’ faith that it lost during the Hindenburg crisis. New investors will also start taking interest in the various assets of the Adani Group.
Fund Acquisition Through Dollar Bond Sale:
As per Bloomberg Report, Adani Green Energy, the renewable energy wing of the Adani Group, is presently in talks with several foreign banks to execute the planned transaction of raising 500 million USD through dollar bonds. The exact details of the transaction have yet to be finalised. So, the terms are subject to change. The decision to raise funds through dollar bonds mainly came into the picture because of the Hindenburg crisis last year in January 2023.
The Main Reason Behind the Sale of Dollar Bonds:
Hindenburg Research, a US-based short-seller, presented a report accusing the Adani Group of stock manipulation and fraud. This led to a scrutiny of the conglomerate’s finances. Within a month, the conglomerate lost INR 12 lakh crores in market value. Most stock values began to fall, leading to the Adani debt. A lot of investors started losing their faith in the Adani Group. They stopped making investments in the proceedings of the business group altogether.
After the allegations, many discussions started between the top officials of the Adani Group to refinance the debt taken to acquire ACC Limited and Ambuja Cement. Still, eventually, all these discussions were suspended. However, later, in the same year, the Adani Group successfully concluded its 3.5 billion USD funding package. The global conglomerate has reduced its debts, pared founders’ share pledges, and taken up massive projects over the past few years.
These strategic business moves have helped the conglomerate revive investors’ trust. A lot of new investors have started making investments in the conglomerate. The business group also received equity capital from prominent investors like GQG Partners and Qatar Investment Authority. A lot of discussions with other big investors are currently ongoing. Together, these investments will help the Adani Group return to its former state of glory.
The Profitability of the Business Group:
Adani Enterprises, the flagship company of Adani Group, has recently announced an extraordinary net profit in the December 2023 quarter. This is 2 times more than the profit made during the year-ago period. The revenue from various operations undertaken by Adani Enterprises jumped 7% to around INR 28,827 crores during the same quarter. The various other subsidiaries operating under the Adani Group have also experienced extraordinary profit, leading to massive growth in the economic prosperity of the conglomerate.
The tables once again turned for the Adani Group after the Supreme Court dismissed the need to appoint a special team to look into the Adani case. Previously, the SEBI was investigating the allegations against the Adani Group. 22 out of 24 cases have been investigated, and nothing has been found against the global conglomerate. So, the Supreme Court did not find the need to appoint a special team to look into Adani Group matters.
To End With:
This way, the Adani Group made an extraordinary recovery after the Hindenburg crisis. A lot of new projects have been taken up after the Hindenburg case. Various new Collaborations were also formed, bringing an end to Adani debt. In the upcoming years, we are expected to see many more extraordinary ventures taken up by the Adani Group on its journey towards achieving success.
