Sebi Seeks Details On Adani Group Companies' Loans And Securities From Rating Agencies: Report

Sebi has asked the rating agencies to share details of Adani Group firms, which would include all outstanding ratings, outlook, and possible updates from any discussions with officials of the group

The Securities and Exchange Board of India (Sebi) has sought details of all ratings of local loans and securities of Adani Group firms from credit rating firms, according to a report by the Economic Times (ET). The market regulator has asked the rating companies to share details of Gautam Adani-led group firms, which would include all outstanding ratings, outlook, and possible updates from any discussions with officials of the business group.

A person privy to the development told ET, “The Sebi is probably trying to ascertain whether the sharp fall in stock prices of several Adani companies would have any bearing on the liquidity positions and the debt repayment capability of the borrowing companies. Most of this information, however, is in public domain.”

While stocks of 10 listed companies of Adani Group have dropped between 21.7 per cent and 77.47 per cent, with Adani Total Gas falling the most, followed by Adani Green Energy and Adani Transmission, none of the rating companies in India have changed the ratings or outlook for Adani companies.

The stock rout was triggered by US-based short-seller Hindenburg Research alleging price manipulation and accounting fraud by Adani Group. A sudden plunge in the share price is among the 'material events' that rating agencies typically factor in to review a borrower's rating and outlook, or put it under 'rating watch', the publication said.

"Since it's close to a month since the Hindenburg report, it possibly cannot be a material event for any rating action. Under the circumstances, rating companies would keep track of other parameters, like a further fall in share price, or other developments for any action," a banker told ET.

As of now, only international credit agencies such as S&P and Moody's have changed the outlook on some of the Adani companies from 'stable' to 'negative', primarily due to rapid decline in the market value of the companies concerned. Local agencies believe the group may review some of its capital expenditure.

The MC A10 index ended sharply lower on February 20 as bears continued to mount pressure on the stocks. The index dropped about 5.36 per cent to 35.37 and was pulled down by heavyweights Adani Enterprises, Adani Green Energy, Adani Total Gas and Adani Transmission. They declined 5-7 per cent each.