Adani Green Energy shares gain 4% on refinancing plan, snaps 12-day losing run. Full details

By admin On Feb 17, 2023

Shares of Adani Green Energy rose 4 per cent in Friday’s trade, snapping a 12-day losing run, after a Reuters report suggested that the Adani group company has a refinancing plan, which it would disclose after the end of the ongoing financial year. An executive of the embattled group informed Adani Green’s bondholders on a call on Thursday, two sources with direct knowledge of the matter told Reuters.

Following the development, shares of Adani Green Energy rose 3.63 per cent to hit Rs 638.85 on BSE. The scrip hit a low of Rs 591 on February 16.

Adani group had hired banks to arrange calls with bond investors after it was caught up in a short-selling storm in recent weeks, the report noted adding that a subsidiary Adani Green Energy Limited Restricted Group will refinance existing bonds through a 15-year amortising private placement.

To recall, Adani Green Energy Restricted Group and parent Adani Green Energy were among four group companies whose outlook were changed to ‘negative’ by Moody’s earlier this week. The other group companies were Adani Transmission Step-One and Adani Electricity Mumbai.

The change in the outlook on Adani Green Energy Restricted Group to ‘negative’ factored in the refinancing risk associated with $500 million of bonds maturing in December 2024, Moody’s had said. Moody’s said it recognised that the project finance structure of Adani Green Energy Restricted Group provides protection from any contagion risk from the broader Adani Group.

In the case of Adani Green Energy, Moody’s had said that the change in the outlook to ‘negative’ considered the company’s large 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,” Moody’s said.

The negative outlook, it said, also factored in the company’s significant refinancing needs of around $2.7 billion in fiscal year ending March 2025 (fiscal 2025) and limited headroom in its credit metrics to manage any material increase in funding costs.

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