Nomura Report: Adani Group Stands Out Among Indian Corporates

Mumbai, Dec 9 (NationPress) The Adani Portfolio of companies is regarded as the most appealing among Indian corporates, as per a report from Japanese brokerage Nomura, which notes that other Indian corporates are priced at expensive levels in contrast to the Group.

In its latest analysis, the global brokerage stated that the conglomerate, which spans from ports to power, is likely to endure the recent challenges caused by allegations stemming from an indictment by the US Department of Justice (DoJ).

"The Adani complex appears most attractive in comparison to other investment-grade (IG) corporates in India. Other Indian IG corporates are trading at expensive levels compared to the Adani complex," the report highlighted.

Nomura further remarked that in light of the Adani-Hindenburg incident early in 2023, the liquidity management within the Adani Group has significantly improved, positioning it to handle the ongoing challenges with a sufficient short-term liquidity stance.

The brokerage indicated that there are currently no signs of stress within the Adani Group and that the fundamentals and asset quality remain intact.

"We are optimistic that the group will be able to navigate through this challenging period," added the financial research firm.

Regarding global banks ceasing their financial backing for Adani companies, Nomura believes that this will pose no issue once the situation concerning the DoJ allegations is resolved. "Additionally, the major three Japanese banks intend to maintain their relationship with the Adani Group," it stated.

Nomura pointed out that the DoJ indictment is merely an allegation, as per Adani Management, and does not constitute a breach of anti-corruption agreements unless proven guilty.

However, Nomura did caution that while global banks may suspend new financing in the short term, they are likely to gradually restart in the long run once the Adani-DoJ situation stabilizes.

"The Big Three Japanese banks are expected to continue their partnerships with the Adani Group," the report added. The Big Three refers to MUFG, SMBC, and Mizuho.

Nomura anticipates an increase in bond prices for several entities within the Adani Group, including Adani Green Energy Ltd., Adani Ports and Special Economic Zone Ltd., Adani International Container Terminal, Adani Electricity Mumbai Ltd., Adani T-One Transmission Ltd., and Adani Renewable Energy Ltd.

For Adani Green Energy, price increases could reach up to 7 points, while for others, the report forecasts an increase of 2 to 4 points.