The KEN report is mischievously misleading, says Adani group

Ahmedabad, 28 March 2023: The Adani Group strongly refutes the news report published by The Ken, a digital publication, which makes the baseless and deliberately mischievous claim that the Group has not completed repayment of USD 2.15 billion in share-backed debt.

Adani has completed full prepayment of margin linked share backed financing aggregating to USD 2.15 billion (see the Adani media release of 12 Mar 2023) and all corresponding shares pledged for those facilities have been released.

Below is the share pledge position as on 31 Dec 2022 and the current share pledge position as on 27 Mar 2023 (factoring in current stock prices).

 Rationale for residual share pledge position:

 All share backed facilities availed by the promoters have been paid off.

  • After such repayment, ListCo pledge positions for Adani Green, Adani Ports, Adani Transmission & Adani Enterprises have reduced substantially, and only residual share pledges corresponding to Operating Company (OpCo) facilities remained outstanding.
  • OpCo facilities are availed by respective OpCo, and are part of their existing debt structure, and no new OpCo facilities have been availed since the short-seller report.
  • Salient features for residual pledge position (OpCo facilities):
    • OpCo have secured various facilities based on the security of project assets, project cashflow and other such collaterals.
    • In addition to such security, listed shares have been provided as additional collateral for these OpCo liabilities for additional lender comfort.
    • Such facilities do not have covenants like cash margin calls, share price linked put option, etc. which exist in share backed financing.

Specific Responses

Quoting from The Ken’s report:

Over the last two months, the group has claimed to have repaid about $2.15 billion; it announced, on 12 March, that all of its margin-linked share-backed debt has been paid. However, regulatory filings examined by The Ken show that banks have not yet released a large portion of its promoters’ shares, as they should have if the loans had indeed been completely repaid. As per Indian laws, disclosures on the release of shares need to be filed with stock exchanges by lenders within two working days, and by promoters within seven working days. But neither the Adani Group nor the lenders have made these disclosures to stock exchanges.

Adani Response:

All the pledged shares have been released subsequent to prepayments made billion (see our media release of 12 Mar 2023).

As per the present rules, any share pledge or release is automatically reported by system driven disclosure (SDD) mechanism of the depository participant, and no separate filing is required to be made. The same has already been updated and is reflected on the NSE website. However, the BSE website has not been updated to reflect the same.

Below are screenshots from the NSE website for Adani Transmission, Adani Green Energy and Adani Enterprises: 

Adani Transmission:

Adani Green Energy:

Adani Enterprises

Quoting from The Ken’s report:

However, an examination of the Substantial Acquisition of Shares and Takeovers (SAST) disclosures of each of these companies by The Ken shows that, after Adani’s prepayment announcement, banks have only released the pledged shares of Adani Ports & SEZ. The pledged shares of Adani Green and Adani Transmission have not been released by banks even a month after the loan repayment. This is highly unusual as pledged shares are usually released immediately after the borrower settles their debts.


Quoting from The Ken’s report:

An examination of SAST records by The Ken revealed two crucial facts. First, despite the group’s claims of “complete” repayment on 12 March, none of the group promoters’ pledged shares in any of the above-mentioned entities (except Adani Ports & SEZ in February as part of the $1.1 billion repayment) have been released by lenders.


Adani Response:

As per the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (“SEBI SAST”), Rule 29 (1) & 29 (2) along with 29 (4) stipulates disclosure obligations on pledge or release of 5% or higher number of shares of the company, which in this case is applicable only to Adani Ports and is not applicable to Adani Transmission and Adani Green Energy. Therefore, only Adani Ports’ disclosure has been filed as per SEBI SAST regulations.

It may be noted that, as per the media release of 6 Feb 2023, 12% of Adani Ports shares were released (which is higher than 5%) and 3% of Adani Green Energy shares and 1.4% of Adani Transmission shares were released. Accordingly, SAST disclosure was applicable only to Adani Ports.


Quoting from The Ken’s report:

On 12 March, the group went further and declared with the headline that “Adani Fully Prepays Share Backed Promoter Financing”. The press statement said the group had “completed full prepayment of margin-linked share backed financing aggregating to $2.15 billion, well before the committed timeline of March 31, 2023”. Interestingly, the two tranches of loan repayment the group has announced—$1.1 billion in February and $905 million in March—add up to ~$2 billion.

Adani Response:

There has been incremental prepayment of USD 134 million completed after the press release of 6 Feb 2023 (USD 1,114 million) and 7 Mar 2023 (USD 902 million), resulting in the updated debt figure of USD 2.15 billion for the press release of 12 Mar 2023.


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