Adani Group plans to use its surplus cash and internal resources to buy back foreign currency bonds of various group companies, starting with a $650 million tranche at Adani Ports and Special Economic Zone.
Fasten your seat belts, Adani Group is about to pick up the pace again. Yes, Adani Group is working on a plan, if it becomes a hit, then within a few days the losses incurred in the month will be recovered. In fact Adani Group plans to use its surplus cash and internal resources to buy back foreign currency bonds of various group companies starting with a $650 million tranche in Adani Ports and Special Economic Zone. According to experts, the group is evaluating opportunities for bond buyback in other companies. To win the trust of global investors, it may soon finalize the capital allocation plan.
Buyback term and condition will be made soon
It is estimated that foreign currency bonds account for about 39 per cent of the group’s total loans. Then there are term loans from foreign and Indian banks. In an exchange filing on Saturday, Adani Port & SEZ said its board, at its meeting held on April 22, has approved a tender offer for the outstanding Senior Notes due 2024 in one or more tranches. The board has authorized the finance committee of the company to determine the timing, detailed terms and conditions for the buyback. Sources said the group would likely start with the first tranche of anywhere between $250 million and $300 million in the current quarter, and would seek to buy back the rest in the coming quarters.
The company has enough cash
According to the corporate filing, Adani Port & HEZ reported a revenue of Rs 15,055 crore and an EBITDA of Rs 7,676 crore in the first 9 months of FY2023. In the financial year 2022, the company had a cash balance of Rs 10,492 crore. Recent corporate filings of Adani Group revealed that it has foreign currency bonds worth about $2 billion in Adani Port & SEZ and Adani Green Energy that will mature next year. Recently there was a report that the group is in talks with investors to refinance some of its foreign currency bonds through private placement.
Adani has reduced its debt
A senior banker of the group said that over the years, the group has been able to continuously diversify its long-term loan portfolio and try to reduce the risk of banks’ loans by using other sources of capital. Let us tell you that after the report of Hindenburg on January 24, there has been a big decline in the shares of Adani Group. Because of which the market cap of Adani Group has reduced by more than $ 100 billion. On the other hand, this investment of Rs 15,000 crore by GQG Partners brought great relief to the Adani Group and since February 27, some companies have recovered 100 per cent and 35 to 40 per cent as a whole.