Adani group pledged shares: GQG deal with 4 Adani firms to ease fund raising concerns, says Kotak

Adani group's completion of 1 of its largest deals astatine $1.9 cardinal done 2.5-4.1 per cent involvement merchantability crossed its 4 listed entities to GQG Partners, should assuage concerns astir the group’s quality to rise backing for the repayment of loans against its listed institution shares -- its stated target, said Kotak Institutional Equities. The home brokerage said Adani radical tin perchance rise different $8 cardinal (at woody price) portion maintaining bulk control.

GQG Partners connected Thursday via artifact deals bought 38,701,168 Adani Enterprises shares astatine Rs 1,410.86 apiece for Rs 5,460 crore. It purchased 88,600,000 Adani Ports shares astatine Rs 596.20 apiece for Rs 5,282 crore. In Adani Transmission, it bought 28,400,000 shares astatine Rs 668.40, totalling Rs 1,898 crore. Besides, it bought 55,600,000 shares of Adani Green Energy astatine Rs 504.60, valuing Rs 2,806 crore.

Based connected December-end marketplace capitalisation of the group’s listed entities with pledged shares, the worth of the aggregate pledged shares was $$9 billion, said Kotak Institutional Equities, adding that the underlying indebtedness would beryllium little based connected plus cover.

"This includes the constituent linked to the $6.5 cardinal acquisition magnitude for the involvement acquired successful cement companies by the group. The caller repayment of specified loans ($1.1 billion), coupled with the existent magnitude raised done involvement merchantability ($1.9 billion), should alteration the radical to repay a large stock of its loans against shares, a stated people of the group," it said.

Adani radical had $9 cardinal of aggregate worth of shares pledged of listed entities and has repaid US$1.1 bn of the underlying indebtedness since December 2022.

Adani Ports a ‘Buy’

Kotak Institutional Equities said it has retained its BUY standing for Adani Ports, suggesting a just worth of Rs 810. Adani Ports, it said, is simply a beardown play connected India’s larboard sector, having charismatic characteristics—pricing power, prospects of privatisation and "strong close to triumph by providing an end-to-end logistics offering."

The Adani Ports banal is trading astatine 11.5 times FY2024 EV/Ebitda against 10-16 times one-year guardant trading range. Its estimates cook successful sub-7 per cent measurement CAGR implicit FY2022-25E successful existing assets and a 13 per cent CAGR successful wide volumes.

"Our DCF-implied 12.5 times EV/Ebitda factors successful 14 per cent outgo of equity. We enactment that the ports concern is different an charismatic 1 with pricing power, well-demonstrated by a crisp 10 per cent summation successful realisations taken by Adani Ports successful FY2023," it said.

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