Fitch Ratings Scrutinizes Adani Amid US Indictments

Fitch Ratings has adjusted Adani Energy Solutions Ltd's outlook to negative, after removing it from a rating watch. The move comes as Adani's executive team faces US legal scrutiny, potentially impacting corporate governance perceptions and financial flexibility, even amid their demonstrated access to funding.

In a significant development, Fitch Ratings has removed Adani Energy Solutions Ltd (AESL) from a rating watch while assigning it a negative outlook. This decision arrives on the heels of the Adani group's leading executives facing indictments in the US, a situation that has spotlighted their corporate governance.

Fitch affirmed the long-term foreign- and local-currency issuer default ratings of AESL at 'BBB-', stating that the Adani group has shown adequate funding access. However, the continuing investigations could unveil potential corporate governance weaknesses, threatening to affect the group's financial ratings adversely.

Despite the legal challenges, Adani has managed considerable financial maneuvers, including securing Rs 5,100 crores from banking sources and refinancing infrastructure-related facilities. Yet, the outcomes of these investigations bear the potential to influence Fitch's future ratings and the group's ability to access funding.

(With inputs from agencies.)