Moody's revises outlook for 7 Adani group companies to 'negative'

Global rating agency Moody's has revised the outllook for seven of the group companies to 'negative', according to Zee Business citing Bloomberg report.

Moody's rating outlook comes close on the heels of Fitch positioning two of the companies entities, namely Adani Energy Solutions Limited (AESL) and Adani Electricity Mumbai Limited (AEML) on a "Rating Watch Negative," signalling a potential downgrade for their 'BBB-' ratings.

The continuous downgrades on the conglomerate group companies follow the indictment of the group's founder and Chairman by the US Federal Court in a bribery case.

Amid the development, all 11 group stocks traded in the red, with Adani Green Energy leading the decline- down over 7 per cent at the last count.

Moody's noted that the change in the outlook of the seven Adani Group companies, will deteriorate the group companies' standing in accessing funds well as increase its capital costs.

Earlier, which bucketing 2 of the companies in the '-ve watchlist', Fitchh noted that AESL and AEML currently maintain robust liquidity. AESL's recent USD 1 billion qualified institutions placement ensures it can fund near-term capital expenditures, while AEML benefits from regulations allowing pass-through of operating and borrowing costs. However, Fitch warned of medium-term funding risks: “Increased reliance on onshore funding could heighten refinancing risks and escalate borrowing costs.