Adani group stocks in focus on reports of $3.8 billion debt refinancing

Shares of Adani group companies will be in focus on Wednesday morning after a Bloomberg report quoting sources suggested the conglomerate, led by billionaire Gautam Adani, is in talks with lenders to refinance up to $3.8 billion of a loan facility taken for its acquisition of Ambuja Cements last year.

Last year, Adani Group acquired ACC Ltd and Ambuja Cements Ltd in a $10.5-billion deal that was financed by bridge loans.

As per the Bloomberg report, the group is mulling whether to convert the original loan into debt with a longer maturity period and has started talking to banks individually about that plan, the report added. The Adani Group's high debt levels were among the concerns that were flagged by US short-seller Hindenburg in a scathing report on January 24.

Since then, the 10 listed companies of the group have lost 46 per cent of market value, which together stood at Rs 10.41 lakh crore as on Tuesday against Rs 19.20 lakh crore as on January 24. Adani Total Gas shares are down 83 per cent since while Adani Transmission shares are down 72 per cent during the same period. Adani Green Energy has also tumbled 50 per cent during the period.

On the other hand, flagship Adani Enterprises, Adani Ports, Adani Wilmar and Adani Power are some of the stocks that have seen solid recovery since.

The Bloomberg report suggested that the refinancing process may conclude within four months and most of its existing lenders, including Barclays Plc, Deutsche Bank AG, Standard Chartered Plc and Mitsubishi UFJ Financial Group Inc, are expected to participate, Bloomberg said.

However, the report cautioned that the deal is yet to be finalised and may not go ahead. Adani Group, Deutsche Bank, Barclays and Standard Chartered declined to comment, while MUFG did not immediately respond to Reuters' request for comments.

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