According to Bloomberg, Adani’s Mundra power plant has more liabilities than assets and has incurred $1.8 billion in losses.
According to Bloomberg, Adani’s Mundra power plant has more liabilities than assets and has incurred $1.8 billion in losses. The conglomerate has used more than $1 billion in creative debt-financing to cover the deficit and reassure investors and lenders that profits will be realized soon.
However, Adani Power Ltd.’s auditor, as well as accounting experts who spoke with Bloomberg News, are unable to fully comprehend the math underlying this claim. “The Mundra Thermal Power Plant — and its debt, which experts say appears designed to protect Adani Power from extraordinary writedowns, regardless of the unit’s losses — exemplifies this balancing act,” according to the Bloomberg report.
Adani Group shares fell on the exchanges after US-based short seller Hindenburg Research filed a slew of allegations against it last month, including fraudulent transactions and share price manipulation. The group has denied the allegations, claiming that it complies with all laws and disclosure requirements.
Listed companies’ shares of the Gautam Adani-led conglomerate lost up to $153 billion in combined market value during the Hindenburg rout but recovered last week. According to the Bloomberg Billionaires Index, Chairman Adani’s personal wealth has dropped by more than half to $49.8 billion.
Adani group management, including group CFO Jugeshinder Singh, held roadshows in Singapore and Hong Kong last month to reassure investors that the company’s finances are under control. From March 7 to 15, these will be extended to Dubai, London, and the United States.
The group is not looking to refinance debt or inject capital, according to group chief financial officer Jugeshinder Singh, who spoke to Bloomberg News last week on the sidelines of an investor roadshow in Hong Kong.
