Here’s why the Adani Group secured $3 billion in credit from a sovereign wealth fund

According sources, India’s Adani Group informed its creditors that it has obtained a $3 billion loan from a sovereign wealth fund.

According to two persons with knowledge of the growing tensions in the Adani Group situation, India’s Adani Group informed its creditors that it has obtained a $3 billion loan from a sovereign wealth fund. As the troubled conglomerate attempts to allay fears about its credit profile following a short-seller attack. According to the two individuals, who cited a memo distributed to participants as one of the highlights of a three-day investor roadshow that ended on Wednesday, the sovereign wealth fund’s credit line might be increased to $5 billion.

The document kept the identity of the sovereign wealth fund a secret. Because they were not authorized to communicate with the media, the sources declined to give their names. An inquiry for comment from Reuters was not immediately answered by an Adani representative.
A day after Adani management informed bondholders that it anticipated to prepay or refund share-backed loans of $690 million to $790 million by the end of March, word of a new fundraising strategy broke.

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Also, recently the stocks of Adani groups has been increased by 40%. After rising 14% yesterday, the shares increased by 15.78% to close at $1,579.00 each, snapping a seven-day losing skid that had been the longest since October 2022. Chart patterns indicate that as long as bulls are able to keep the market above crucial support at roughly 1,400, they may be eyeing 1,900, which is nearly 40% higher than yesterday’s closing.

The stock finished the session with a so-called “bullish engulfing” pattern, continuing the rally that started on Tuesday. Also, yesterday’s activity on the NSE was close to 340 lakh shares, which is almost 2.4 times higher than the 20-day average and the largest volume since 3 February, when 439 lakh shares moved on the day of the crash lows. The ports-to-power Adani Group’s ten equities all closed higher, which was the first time since the empire’s shares experienced an unheard-of decline following the bombshell report by US-based short-seller Hindenburg Research on January 24.

After 26 consecutive sessions of losses, Adani Total Gas increased by 4.9%. After the publication of the report alleging accounting fraud and stock manipulation, the conglomerate’s market valuation has decreased by nearly $145 billion. The billionaire Gautam Adani-led company Adani has refuted the accusations and denied any misconduct.

The group claimed to have enough cash on hand to prepay numerous debts, including onshore bonds, and it has already begun doing so. Adani Group has informed its creditors that a sovereign wealth fund has agreed to lend it $3 billion. According to a Reuters story, the sovereign wealth fund’s credit line could be expanded to $5 billion. A day after group management informed bondholders that it anticipated to prepay or refund share-backed loans of $690 million to $790 million by the end of March, news of Adani getting additional financing surfaced.