Adani Green Energy completes funding of reserves for $750 mn Holdco bonds; shares up 4.40%

Adani Green Energy Limited (AGEL) has successfully completed the funding for its $750 million 4.375 per cent notes due on September 9, 2024, known as Holdco Notes. This financial milestone was achieved following the receipt of funds from a preferential allotment amounting to Rs 9,350 crore (approximately $1,125 million) to AGEL's promoters. The shareholders of AGEL had given their overwhelming approval for this preferential allotment with a 99.9% majority on January 18, 2024.

Subsequently, the promoters made a significant primary infusion of Rs 2,338 crore ($281 million) into AGEL. These funds have been allocated to the Senior Debt Redemption Account (SDRA) and other reserve accounts associated with the Holdco Notes. The completion of this funding was confirmed in a regulatory filing by AGEL.

The breakdown of the funding sources is as follows: $300 million from TotalEnergies JV proceeds were funded in the SDRA on January 3, 2024; the promoter's preferential allotment of $281 million was funded in the SDRA on January 25, 2024; and an accumulated balance of $169 million in the Debt Service Reserve Account, Hedge Reserves, and Interest on Reserve Account.

With these contributions, the total redemption of the bond is fully secured in the respective accounts through term fixed deposits, which are earmarked exclusively for the redemption of the Holdco Notes.

This strategic financial planning ensures that the bond stands defeased, meaning it is effectively considered repaid, eight months before the maturity date of the Holdco Notes. This move is in line with Adani Green Energy's commitment to achieving its target of 45 GW capacity by 2030.

The successful equity capital raise program, which includes funds from both long-term investors and strategic partners, along with the unwavering commitment of the promoters, has been pivotal in reaching this goal.

Meanwhile, Adani Group stocks were rallying higher on Monday before its earnings and the 2024 interim budget. While Adani Enterprises' shares rose by as much as 6 per cent to Rs 3,063.90 on Monday with a total m-cap of around Rs 3.5 lakh crore, Adani Green Energy stock was trading 4.40 per cent higher at 1,737.75 with a total valuation of Rs 2.75 lakh crore.

Also Read: Adani Group stocks rally up to 7% amid Q3 results season; Total mcap nears Rs 15.6 lakh crore

Also Read: Pre-budget market rally? Sensex, Nifty surge over 1% each; here're sectoral expectations