Adani takes bond brokers on Gujarat trip to instill confidence

Image credit: Adani Group/Supplied

Indian billionaire Gautam Adani’s conglomerate took a group of local bond arrangers on a site visit last week, people familiar with the matter said, after gearing up to sell up to INR150bn ($1.8bn) worth of debt amid lingering concerns about its corporate governance.

The Adani Group flew the bankers to Mundra port in Gujarat to showcase the infrastructure of India’s largest private port and elaborate on the conglomerate’s strong financial conditions and expansion plans, said the people who requested anonymity discussing private matters.

Adani Group’s Mundra tour

Darashaw & Co, JM Financial, Nuvama Wealth and Investment, SBI Capital Markets, Tipsons Consultancy Services, Trust Investment Advisors and Yubi Group were among those participating in the visit, the people said.

The trip marks Adani Group’s latest effort to reassure markets after months of damage control following US shortseller Hindenburg Research’s January report detailing alleged corporate malfeasance — claims the conglomerate has strongly denied. It is also an indication that the conglomerate is trying to diversify its funding channels by tapping the local capital market.

India’s capital markets regulator is due to compile a report in to Adani Group on allegations of impropriety and shortfalls in corporate governance. It sought a 15-day extension for the submission this week.

An Adani spokesperson didn’t immediately respond to Bloomberg’s request for comment. Representatives at Darashaw, JM Financial, Nuvama, SBI Capital, Tipsons, Trust Investment didn’t immediately respond to an emailed request for comment. Yubi declined to comment.

While it remains to be seen whether the gathering will lead to any deal, it shows Adani’s attempt to drive home the view that the Hindenburg attack is a thing of the past and that the priority now is building trust with and confidence among influential and well-connected domestic investment banks.

Adani looks to raise funds

Adani Enterprises, the flagship firm, last month raised INR12.5bn through a sale of domestic bonds, its first such local-currency offering since being targeted by the shortseller.

Several global banks are in talks to lend between $600m and $750m collectively to the group, as part of discussions to refinance the debt taken to fund its purchase of Ambuja Cements, Bloomberg reported in late July citing people familiar with the matter.