Four Adani Group companies’ debt papers outlook were upgraded by Moody's Investor Group from “negative” to “stable”, while maintaining a stable outlook for the remaining four. All eight companies had their ratings affirmed.

What Happened: The companies with revised rating outlooks include Adani Green Energy, Adani Green Energy Restricted Group, Adani Transmission Step-One Limited and Adani Electricity Mumbai.

Adani Green Energy Restricted Group, Adani Energy Solutions Limited Restricted Group 1 (AESL RG1), Adani Ports and Special Economic Zone and Adani International Container Terminal.

This move follows S&P’s recent upgrade of credit outlook to “stable” from “negative” for Adani Ports and Adani Electricity.

In February 2023, Moody’s had revised the outlook on four rated Adani Group companies to negative, citing concerns over their capital access and potential increase in capital costs following a report by Hindenburg Research, a short seller.

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The report alleged grievous financial misconduct by the Adani Group, triggering significant declines in the market value of its securities.

Things Have Changed: Moody's noted that since then, the Group has executed several debt transactions, including refinancing and obtaining new loan facilities, demonstrating continued access to debt capital at reasonable costs. Additionally, equity transactions by institutional and strategic investors, such as GQG and Qatar Investment Authority, underscored the Group’s ongoing equity market access, the ratings agency said.

While SEBI’s investigation is ongoing, the Supreme Court’s decision to assign SEBI to complete the investigation on the Adani Group, coupled with its view of no apparent regulatory failure attributable to SEBI, has mitigated potential downside risks in a downside scenario, according to Moody's assessment.

Price Action: All Adani Group companies were in the black near the start of trade on Wednesday, except Adani Total Gas, Adani Power and Adani Energy Solutions. Adani Green was leading the pack with gains of 1.79% to ₹1,848 per share on the back on the ratings upgrade.

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