- By Aditya Pratap Singh
- Tue, 28 May 2024 05:44 PM (IST)
- Source:PTI
Adani Group: Adani Enterprises Ltd, the flagship firm of billionaire Gautam Adani's group, stated on Tuesday that its board has authorized the raising of Rs 16,600 crore (around US$2 billion) through share sale. The announcement came a day after the group's utility Adani Energy Solutions Ltd obtained similar authorization to raise up to Rs 12,500 crore via qualified institutional placement (QIP) or any other permissible mode.
In a stock exchange filing, Adani Enterprises stated that the fund raising can take place in one or more tranches. Both businesses will need other clearances, including that of shareholders. While Adani Enterprises Ltd. has called a shareholder meeting on June 24 to approve the fund raising, Adani Energy Solutions Ltd.'s annual general meeting (AGM) is slated for the following day.
Both firms received similar approvals through 2023, but those clearances were to terminate in June, prompting the demand for fresh authorization. In May 2023, the board of Adani Enterprises had authorized the raising of funds worth Rs 12,500 crore via QIP. That month, Adani Energy Solutions also received board authorization to raise Rs 8,500 crore via QIP.
Funding from institutions such as banks and private equity funds will both increase the businesses' shareholder count — one of the major criticisms against the Adani Group — in addition to boosting their stature globally.
This will also lower the stake of promoter Adani family in the post-equity capital of the businesses. The Adani family holds a 72.61 percent stake in Adani Enterprises Limited and a 73.22 percent stake in Adani Energy Solutions Limited. Both businesses did not move ahead with the 2023 board approval to raise funds. Board authorization for fund raising is enabling proposals so that businesses can act promptly whenever they find the greatest financing terms. However, it is not mandatory for them to raise this amount of money.
Last year, the Apple-to-airport conglomerate increased capital spending as it recovered from the blow of a disastrous report from US short seller Hindenburg Research.
At its lowest point, Adani Group shares lost around US$150 billion in market capitalization, but have recovered since. Four of the 10 listed Adani companies have risen to pre-Hindenburg levels, and tycoon Adani's net worth has increased by US$25 billion this year to over US$109 billion.
He is currently ranked 13th in the world, just one rank below Mukesh Ambani, who is worth US$114 billion. The group's claw-back strategy that included bringing debt under control and slowing down neck-break speed expansion led to it raising around Rs 45,000 crore from Qatar Investment Authority, Abu Dhabi-based IHC, French giant TotalEnergies, and US-based marquee investors GQG Investing.
In a stock exchange filing, business incubator Adani Enterprises Ltd., which has businesses ranging from airports to data centers, stated that its board has authorized the raising of funds by issuing such number of equity shares of the company with face value of Re 1 each. Has given. / or other eligible securities or any combination thereof, via QIP or any other permissible mode in one or more tranches for an aggregate amount not exceeding Rs 16,600 crore or an amount equivalent thereto.
However, it did not provide details on the use of the funds. Adani Enterprises had in February last year called off a follow-on share sale through which it had raised Rs 20,000 crore after Hindenburg accused the group of accounting fraud, stock manipulation, and improper use of tax havens. The group's stock had tumbled. Adani Group has rejected all the allegations.
(With PTI's Inputs)
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