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Adani Green Energy Sets Ambitious Expansion Plans with Rupees 12,300 Crore Fundraising Initiative

Adani Group's Renewables Arm, Adani Green, Raises Investor Confidence with Major Fundraising Plan

6 July 2023

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Kunal Tyagi

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  • Adani Green Energy Ltd plans to raise up to Rs. 12,300 crore through a qualified institutional placement or other eligible securities.

  • The fundraising aims to address market concerns and improve the company's ability to service its debt.

  • Adani Green is actively seeking more institutional investors and research analysts to enhance transparency and market visibility.

Adani Green Energy Ltd (AGEL), a leading renewable energy firm in India, has announced its intention to raise up to Rs. 12,300 crore to support its expansion plans. The company aims to secure the capital through a qualified institutional placement (QIP) or other eligible securities, as disclosed in a recent filing with the exchange. However, the final amount to be raised is subject to various approvals, including those from regulators and AGEL's shareholders. Despite recent market volatility, Adani Green's stock price experienced a modest increase following the announcement.


Addressing Market Concerns:


Over the past year, Adani Green's stock has faced a significant decline of 50%, while the broader market index, Nifty 50, recorded a 22% gain. In an effort to address investor concerns, Adani Green plans to raise funds through the sale of new shares and the divestment of promoter shares held by Adani family entities, including group founder Gautam S. Adani. This strategic move is expected to improve the company's ability to service its debt and restore confidence among investors.


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Rebounding from Hindenburg Setback:


Earlier this year, Adani Green's capital expenditure and fundraising plans were put on hold following a damaging report by US short-seller Hindenburg Research. The report alleged stock price manipulation and accounting fraud within the Adani Group conglomerate. However, the Adani family trust, which owns a significant stake in Adani Green, has denied all charges. With the current fundraising efforts, Adani Green aims to revive its capex plans and rebuild its reputation in the renewable energy sector.


Expanding Investor Base and Research Coverage:


To strengthen its position in the market, Adani Green is actively seeking more institutional investors and attracting research analysts to cover the company. Presently, only one analyst is tracking the firm. By increasing its investor base and research coverage, Adani Green aims to enhance transparency and market visibility, thereby improving investor confidence and potentially driving the stock's performance.


Comprehensive Fundraising Efforts:


The Adani Group, of which Adani Green is a part, has embarked on comprehensive fundraising initiatives. In addition to Adani Green, the group plans to raise funds for Adani Enterprises and Adani Transmission, amounting to Rs. 21,000 crore collectively. Adani Enterprises aims to secure Rs. 12,500 crore, while Adani Transmission targets Rs. 8,500 crore. These fundraising activities reflect the conglomerate's determination to overcome the challenges brought about by the Hindenburg Research report and rebuild its market value.


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