Adani Group cites reduced debt load to rebut overleveraged view

The Adani Group said its companies have reduced their debt burden, as the empire backed by Asia’s richest person sought to rebut a report saying its finances had become stretched. 

Using figures that differed from those cited by CreditSights in the report last month, the conglomerate said the leverage ratios of its companies “continue to be healthy and are in line with industry benchmarks.” 

“The companies have consistently de-levered,” with the net debt to Ebitda ratio declining to 3.2 times from 7.6 times in the last nine years, the conglomerate said.

The statement on Monday comes after CreditSights, a Fitch Group unit, termed the empire built by billionaire Gautam Adani “deeply overleveraged” due to an expansion that “pressurized its credit metrics and cash flows.” 

Adani, 60, has spent the past few years expanding his coal-to-ports conglomerate, venturing into everything from data centers to cement, media and alumina. The group now owns India’s largest private-sector port and airport operator, city-gas distributor and coal miner. 

Adani also pledged to invest $70 billion in green energy to become the world’s largest renewable-energy producer. 

Monday’s report listed Adani Enterprises as having a ratio of earnings before interest, taxes, depreciation and amortization (Ebitda) to gross interest of 1.98. CreditSights listed a figure of 1.6. 

It also cited metrics such as the share of debt to equity, which Adani did not refer to.