The largest port operator in India, Adani Ports & Special Economic Zone, is in the international debt market with a benchmark issue for raising a sum of nearly $500 million. Sources cite that this represents the third largest sale of bonds by domestic issuers after the $1 billion issuance of the EXIM Bank at record low prices over the first week of January, followed by SBI’s sale of $6 billion in the second week.
According to reliable sources, Adani Group had reportedly raised a sum of $750 billion in July 2020, and another $300 million in the month of December 2020 for the purpose of retiring some of its higher cost debt.
For the record, the highly leveraged Adani Group undergoes massive expansion mostly via debt. In this regards, Fitch Ratings has also provided a BBB- rating to the port operator for the sale of its proposed senior unsecured notes, accompanied with a negative outlook.
In terms of volume, Adani Ports stands as the largest port operator and developer in India with some dry bulk terminals including coal, depicting an annual capacity of 478.6 million tonnes. The company is planning to raise a sum of $500 million in the dollar debt market via a Reg S issue. The last time, Adani Ports had paid 4.2 per cent coupon towards its issuance of $750 million in July 2020.
The company held nearly 17 per cent of India’s seaborne cargo through the FY20 and has reportedly acquired a stake of 75 per cent in the Krishnapatnam Port, which was prominently funded via the issuance of the $750 million bond in the month of July.
Adani Ports operates 10 ports across the costs with the Mundra Port accounting for 62 per cent of total throughput of the company. It is to be noted that this port also serves as the gateway towards the landlocked Northwestern region of India.