‘Sufficient liquidity to cover debt requirements for 12 months’: Adani Group
Amid ongoing scrutiny over alleged $250 million bribery scheme to secure lucrative renewable energy contracts, power-to-port conglomerate Adani Group on Monday released its portfolio for the first half of the current fiscal along with trailing-twelve-month (TTM) results and credit compendium.
The billionaire Gautam Adani-led group claims that its portfolio companies have sufficient liquidity to cover all debt servicing requirements for at least the next 12 months. The cash reserves stand at ₹53,024 crore, amounting to 20.53% of gross debt, which is sufficient to cover next 28 months of debt servicing requirements, the release noted.
The cash profit or flow from operations (FFO) for the twelve months ended September 2024 rose to ₹58,908 crore, up 28.4% YoY.
As of September 30, 2024, gross assets to net debt stood at 2.7x versus 2.6x at the end of FY24, while net debt to EBITDA was at 2.46x against guidance of 3.5x-4.5x.
As per the release, the group’s Earnings before Interest, Taxes, Depreciation, and Amortisation (EBITDA) touched highest-ever at ₹44,212 crore in H1 FY25, up 1.2% YoY), taking TTM EBITDA at ₹83,440 crore (up 17.1% YoY). “After adjusting for the non-recurring previous period’s income in Adani Power, the EBITDA growth was at 25.5% for H1 FY25 and 34.3% for TTM respectively. Run-rate EBITDA, which includes annualisation of profits from recently operationalized assets, is now at ₹88,192 crore.”
The consistent growth in EBITDA in the first half was largely driven by the group’s highly stable and resilient ‘Core Infrastructure’ platform, which constituted 86.8% of H1 FY25 EBITDA. The ‘Core Infrastructure’ platform comprises—AEL’s infrastructure businesses, utility (Adani Green Energy, Adani Power, Adani Energy Solutions, and Adani Total Gas) and transport (Adani Ports & SEZ) businesses.
“AEL’s infrastructure businesses, with 70.1% YoY growth in the H1 FY25, led the overall growth. These businesses include solar and wind manufacturing (part of the green hydrogen production chain), airports and roads businesses,” highlights the release.
On the rating front, 76% of EBITDA was from assets with India rating above ‘AA-‘. APSEZ received “AAA” rating from 4 domestic rating agencies – CRISIL, ICRA, CARE, India Ratings, and an outlook upgrade from S&P.
In the first half, the portfolio companies invested ₹75,277 crore increasing the total gross assets to ₹5.53 lakh crore. This was attributed to Adani’s strategic focus on its infrastructure platform, which provides high stability and predictability.
Adani Group issued a comprehensive overview of the financial performance of portfolio companies and the credit compendium to ease investors concerns about the conglomerate’s credit strength. This came five days after the chairman Gautam Adani and seven others were indicted in the U.S. court for allegedly bribing Indian government officials to secure lucrative solar energy contracts worth billions of dollars. The U.S. Securities and Exchange Commission (SEC) also charged Gautam Adani and his nephew Sagar Adani for conduct arising out of a massive bribery scheme.
Meanwhile, Adani Group has said it will respond to bribery allegations levelled by the U.S. government after "reviewing" the charges in detail and seeking counsel approval as the matter is "sub-judice." Jugeshinder Robbie Singh, the chief financial officer of Adani Group, has said the allegations specifically relate to one contract of Adani Green Energy, which is roughly 10% of the overall business of Adani Green.
"There is a lot more precise and comprehensive detail of this which we will elaborate in an appropriate forum," Singh says, adding that Adani Group has a portfolio of 11 public companies and none are subject to indictment. “None of the issuers (i.e. companies in our portfolio or specific issuers that are subsidiaries of the public companies) are accused of any wrongdoing in the said legal filing,” he says.