Moody’s acts on Adani companies

Moody's Investors Service said it affirmed the ratings on eight Adani Group companies but changed the outlook on four issuers to negative from stable and kept the outlook stable on the other four companies.

The four companies are Adani Green Energy Ltd. (AGEL), Adani Transmission Step-One Ltd. (Atsol), Adani Electricity Mumbai Ltd. (AEML), Adani Green Energy Restricted Group, (AGEL RG-1) comprising Adani Green Energy (UP) Ltd., Parampujya Solar Energy Private Ltd. and Prayatna Developers Private Ltd.

“The change in the outlook to negative on AGEL considers the company's large capital spending program and dependence on sponsor support, potentially in the form of subordinated debt or shareholder loans, which will likely be less certain in the current environment,” the agency said, in a press release.

“The change in the outlook on Atsol to negative considers the modest headroom in ATL's credit metrics relative to the minimum tolerance level under Moody's base case scenario, which limits the group's ability to withstand a material increase in funding cost or reduced funding access,” Moody’s said.

“The change in outlook to negative reflects the likely reduction in its funding access and reduced ability to manage any material increase in funding costs given the limited headroom in its credit metrics under Moody's base case scenario,” the agency noted about AEML.

“The change in the outlook on AGEL RG-1 to negative factors in the refinancing risk associated with $500 million of bonds maturing in December 2024,” Moody’s said.

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