'No immediate impact on Adani ratings after Hindenburg report', says Fitch Ratings

The rating agency said it expects no material changes to forecast cash flow of Adani Group companies.

New Delhi, Feb 03: Fitch Ratings on Friday said there is no immediate impact on the ratings of Adani entities and their securities following a short-seller report alleging malpractices at Adani group.

In a statement, the rating agency said it expects no material changes to its forecast cash flow. "There are also no near-term significant offshore bond maturities," it said.

The clarification comes after the damning US short seller Hindenburg report that alleged the Adani Group of stock manipulation, accounting fraud and other malpractices.

"There are also no near-term significant offshore bond maturities - earliest in June 2024 for Adani Ports and Special Economic Zone Limited (APSEZ, BBB-/Stable); December 2024 for Adani Green Energy Limited Restricted Group 1 (AGEL RG1, BB+/Stable); and 2026 or beyond for all other entities - reducing refinancing risks and near-term liquidity risks," it said.

On January 24, Hindenburg Research released a report alleging the Adani group firms of various purported malpractices that led to a downfall in the share and bond prices of various group entities, despite the group publishing its 413-page response on 30 January 2023.

The report by the tiny New York firm that specialises in short selling led to Adani Group losing more than USD 50 billion in market value in just two trading sessions last week and Adani himself losing in excess of USD 20 billion, or about one-fifth of his total fortune, as reported by PTI.

In the report, Hindenburg called out the conglomerate's "substantial debt", which includes pledging shares for loans; that Adani's brother Vinod "manages a vast labyrinth of offshore shell entities" that move billions into group companies without required disclosure; and that its auditor "hardly seems capable of complex audit work".