The Adani Group has taken a significant step in its ongoing financial rehabilitation, with flagship company Adani Enterprises Ltd. successfully raising ₹250 billion (₹25,000 crore) through a rights issue. This marks the conglomerate’s largest equity raise since the damaging short-seller attack of early 2023 and signals that access to India’s local capital markets is opening up once again.
The move underscores improving investor confidence in the group as it works to stabilize operations, reduce debt, and rebuild credibility after the turbulence of the past two years.
A Major Equity Raise—and a Market Signal
The rights issue, priced at ₹1,800 per share on November 11—representing a 24% discount to the prevailing market price—saw strong investor participation. Although Adani group companies have already raised over $1.5 billion in institutional placements since 2023, this offering marks the first test of wider shareholder appetite.
The significance of the raise extends beyond the number:
It shows Indian capital markets are once again willing to extend support.
It helps the conglomerate strengthen capital buffers and reduce leverage.
It offers investors an opportunity to accumulate stock ahead of expected value creation events.
Nearly three-fourths of the funds will be directed toward repaying borrowings owed to group entities and external lenders, including the State Bank of India.
Improving Valuation Alignment
Adani Enterprises’ valuation is now better balanced relative to its earnings. The stock currently trades at 52 times forward earnings—still high, but far below the lofty multiples seen before the Hindenburg report in early 2023.
A clearer earnings outlook, combined with a more rational valuation, contributed to increased investor comfort during the rights issue.
Additionally, anticipation is growing around the planned 2027 listing of Adani’s airports business, which now contributes around 10% of Adani Enterprises’ revenue. Investors view this future listing as a potential value unlock.
Challenges Remain—Especially Overseas
While access to local markets is improving, global financing channels remain constrained.
The U.S. Justice Department has accused Adani Green Energy and founder Gautam Adani of bribery—allegations the group firmly denies. However, the episode has made international lenders more cautious.
Global banks now hold 23% of the group’s debt, down from 27% in September 2024.
This decline underscores the difficulty the conglomerate faces in tapping foreign credit markets.
Domestic investors continue to treat the group warily, concerned about political sensitivity and concentration risk, although such concerns existed even before the short-seller attack.
Shareholding Structure Largely Unchanged
Despite the rights issue, Adani Enterprises remains as tightly held as before, with little evidence that its shareholder base is broadening substantially. This is consistent with pre-Hindenburg trends and mirrors investor ambivalence regarding the group’s rapid expansion trajectory.
Nevertheless, existing shareholders appear willing to support the company’s capital-raising plans and look past ongoing controversies.
A Step Forward, With Caution Ahead
The ₹250 billion rights issue is a meaningful milestone in the Adani Group’s recovery path. It:
Strengthens liquidity and reduces debt
Reopens access to domestic equity markets
Demonstrates improving investor confidence
Provides fresh momentum for upcoming strategic initiatives, including the airports business listing
Yet the journey toward full financial rehabilitation remains unfinished. Regulatory scrutiny, global creditor hesitancy, and lingering investor caution continue to shape the company’s operating environment.
For now, however, Adani has loosened its fundraising straitjacket—and signaled that the next phase of its resurgence is firmly underway.
