The Adani Group has seen a significant drop in their dollar bond yields in the last two weeks, with rates easing by up to 500 basis points (bps) following the company’s early repayment of loans. According to dealers, this move has improved investor sentiment towards the Indian conglomerate, resulting in a marked drop in bond yields.
Bloomberg data indicates that the yield on the overseas bonds of Adani Electricity Mumbai Infra fell to 8.7614 per cent on March 13, down from 9.4626 per cent on February 28. Similarly, Adani Green Energy’s bond yield fell to 12.72 per cent from 18.3702 per cent, while bond yields of Adani Ports & Special Economic Zone and Adani International Container Terminal fell to 8.871 per cent and 6.857 per cent, respectively, from 9.586 per cent and 7.0388 per cent earlier.
“The yield on Adani dollar bonds has eased in the last few days because of the measures taken by the group by early prepayment of loans, which has given some comfort to investors,” explained Kranthi Bathini, Equity Strategist at WealthMills Securities Pvt Ltd.
The Adani Group, which has interests in a wide range of sectors including ports, airports, energy, and infrastructure, has been the subject of increased scrutiny in recent months, with concerns being raised over its close ties to the Indian government and its impact on the environment.
The drop in Adani Group’s bond yields has come as a welcome relief for the company, which has been grappling with many challenges in recent months. The Indian conglomerate has faced intense scrutiny from environmental activists and other stakeholders, who have raised concerns over its alleged links to the Indian government and its impact on the environment.
However, the company has sought to allay these concerns by taking several steps to improve its environmental and social practices. For example, it has pledged to invest heavily in renewable energy and has set a target to become carbon-neutral by 2025.
The recent drop in bond yields is likely to be seen as a positive sign for the company, as it seeks to restore investor confidence and maintain its position as a leading player in India’s economy. With the global economic outlook still uncertain, the Adani Group will no doubt be closely monitoring developments in the coming months to ensure it remains on track to achieve its long-term strategic objectives.
Despite these concerns, the group’s early repayment of loans appears to have reassured investors, leading to a drop in bond yields. While it remains to be seen how the situation will evolve in the coming weeks and months, this development is likely to be seen as a positive sign for the Adani Group, as it seeks to maintain its position as one of India’s leading conglomerates.
