NEW DELHI: A group of lenders, led by the State Bank of India (SBI) conducting an annual review of Adani Enterprises Ltd (AEL), have decided to maintain the credit limits previously sanctioned for Gautam Adani's flagship company, the Economic Times reported quoting two sources on Tuesday.
The review, however, is a routine exercise by lenders to evaluate the company's operations and assign capital on loans. AEL has been assigned loans of ₹13,900 crore, which include fund-based and non-fund-based loans, as well as working capital loans of nearly ₹2,000 crore, mostly in the form of commercial paper.
The SBI completed the review in January, and one of the sources stated that the review of Adani Enterprises coincided with the release of a Hindenburg Research report that alleged share manipulation and money laundering. Adani Group has denied these allegations, and senior bank officials have declined to comment on the matter.
Despite the slump in Adani Group's share price since the release of the Hindenburg report, the lenders are confident that the company's cash flow is sufficient to meet its liabilities and execute its projects. The senior Adani Group management has confirmed that the group's combined liquidity stood at ₹26,000 crore as of December 31, 2022, which is significantly higher than the group's debt maturities of ₹14,000 crore during FY23-FY24.
However, the group's liquidity may have dried up due to the redemption of commercial papers worth ₹1,500 crore between February and March this year. The company is not planning to raise fresh commercial papers immediately, according to one of the sources. Promoter Gautam Adani and his family have also repaid ₹9,250 crore of debt backed by shares, as reported by the ET on February 7.
Lenders are also reviewing loans of other Adani Group companies, such as Adani Power and Adani Ports and SEZ, as the group has proposed to curtail its capital expenditure and is no longer proceeding with some plans, such as the acquisition of power units from DB Power or the memorandum of understanding with Orient Cement for the lease of land parcels for its power plant.
