Adani Group bonds take a hit amid US bribery probe

Several of Adani Group's dollar bonds have witnessed their most substantial drop in over six months, following reports that US prosecutors are broadening their investigation into the conglomerate.

The probe now specifically examines whether the Indian multinational engaged in bribery practices. This news has also led to a downturn in the share prices of most Adani Group companies.

Adani units face sharp bond declines

Adani Ports & Special Economic Zone Ltd., a critical entity within the group, saw its 2041 notes fall by 2.4 cents to 79.1 cents, marking the largest decrease since August.

Similarly, Adani Renewable Energy RJ Ltd.'s 2039 bonds dipped by 2.3 cents to 83 cents, experiencing their most pronounced decline since February 2023.

These drops reversed the gains observed in recent months, which had pushed the bonds to their highest levels since 2022.

Share values of Adani Enterprises fall

The flagship company, Adani Enterprises Ltd., faced a significant drop, with its shares decreasing by as much as 5%. Other entities within the group also saw their share values fall by 3%-8%, although there was a partial recovery from these initial losses.

Market still optimistic

Despite these setbacks, some market observers remain optimistic about the group's resilience. The Adani Group has refuted any allegations of misconduct, affirming its compliance with anti-corruption and anti-bribery laws in India and abroad.

The widening US investigation into alleged bribery adds another layer of complexity to the challenges faced by the Adani Group.

However, the conglomerate has made efforts to reassure investors by reducing debt, scaling back on founders' share pledges, and successfully issuing a dollar bond earlier this month.

Despite these measures, the combined market value of the group's listed entities remains below the levels seen before the allegations emerged, indicating that investor concerns persist.