Adani Enterprises NCD Sept. 24 Issue review (Apply)

• This is the maiden debt issue from the flagship company of Adani group.
• Base size of the issue is Rs. 400 cr. and has green shoe option of Rs. 400 cr. thus making an overall size of the offer of Rs. 800 cr.
• This debt offer is rated CARE A+/Positive by CARE Ratings Ltd.
• The coupon rates are 9.25% to 9.90% based on the series opted.
• Allotment will be made on "First come - First Served" basis.
• Investors may lap it up for medium to long term.

ABOUT COMPANY:
Adani Enterprises Ltd. (AEL) is a part of the Adani group, which is among India's top business houses with an integrated energy and infrastructure platform in India and a long track record of successfully executing large-scale projects. It is one of India's largest listed business incubators in terms of market capitalization and are driven by the philosophy of incubating businesses in four core industry sectors - energy and utility, transportation and logistics, consumer, and primary industry. The company represent an effective complement of established and developing businesses which address the needs of India.

It has, over the years, seeded new business interests for the Adani portfolio, developed them into sizeable and self-sustaining business verticals and subsequently demerged them into independently listed and scalable platforms, thereby unlocking value for its shareholders. The company has a demonstrated track record of creating sustainable infrastructure businesses since 1993. It has emerged as an incubator by investing, maturing and eventually demerging various diversified businesses. Since inception, AEL has incubated sizeable and scalable businesses and successfully listed them, including by way of demergers, as Adani Ports and Special Economic Zone Limited, Adani Power Limited, Adani Energy Solutions Limited, Adani Green Energy Limited, Adani Total Gas Limited and Adani Wilmar Limited. As of June 30, 2024, the Adani portfolio had a market capitalization of Rs. 16,200 billion (approximately US$ 194 billion) and are one of the largest listed group by market capitalization in India. As of March 31, 2024, it had 7176 employees on its payroll.

ISSUE DETAILS:
The company is coming out with its maiden debt offer of 8000000 Secured, Rated, Listed, Redeemable, Non-convertible debentures of face value of Rs. 1000 each amounting to Rs. 400 cr. with an option to retain over-subscription up to Rs. 400 cr. aggregating up to Rs. 800 cr. The minimum application to be made is for 10 NCDs i.e. Rs. 10000, and in multiple of 1 NCD i.e. Rs. 1000, thereon, thereafter.

The issue opens for subscription on September 04, 2024, and will close on or before September 17, 2024. Post allotment, NCDs will be listed on BSE and NSE.

The company is spending Rs. 14.94 cr. for this debt offer and from the net proceeds, it will utilize at least 75% for prepayment/repayment in full or in part its existing indebtedness, and up to a maximum limit of 25% for general corporate purpose.

This debt offer has tenor of 24 months, 36 months, and 60 months and the coupon rates is ranging from 9.25% to 9.90%. The interest payment frequency will be Annual, Cumulative or Quarterly, as per the the investors. The company has allocated 10% for Institutions, 30% for Non-institutions, 30% for HNI investors and 30% for Retail investors. The allotment will be made on "First come - First Served" basis.

This debt offer is lead managed jointly by Trust Investment Advisors Pvt. Ltd., A K Capital Services Ltd., and Nuvama Wealth Management Ltd., while Link Intime India Pvt. Ltd. is the registrar to the issue. Catalyst Trusteeship Ltd. is the debenture trustee to the issue.

ISSUE RATING:
This debt offer is rated CARE A+, Positive by CARE Ratings Ltd. Securities with these ratings are considered to have adequate degree of safety regarding timely servicing of financial obligations. Such securities carry low credit risk. The rating is not a recommendation to buy, sell or hold securities and investors should take their own decision. The rating may be subject to revision or withdrawal at any time by the assigning rating agency and each rating should be evaluated independently of any other rating. The rating agency has a right to suspend or withdraw the rating at any time on the basis of factors such as new information.

FINANCIAL PERFORMANCE:
On the financial performance front, for the last three fiscals, the company has (on a consolidated basis) posted a total income of Rs. 70432.69 cr. / Rs. 475.37 cr. (FY22), Rs. 138175.12 cr. / Rs. 2208.94 cr. (FY23), and Rs. 98281.51 cr. / Rs. 3293.40 cr. (FY24). For Q1 of FY25 ended on June 30, 2024, it earned a net profit of Rs. 1651.96 cr. on a total income of Rs. 26066.72 cr. Its debt equity ratio of 1.32 as of June 30, 2024 will stand enhanced to 1.34 post this issue.

Conclusion / Investment Strategy

This is the first debt offer from the Adani group flagship company that has amply rewarded stakeholders. This debt issue has lucrative coupon rates with CARE A+/Positive ratings. Investors looking for steady income may lap it up for medium to long term rewards.

Reviewer recommends Subscribing to the issue.

Review By Dilip Davda on August 31, 2024

Review Author

DISCLAIMER: No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor before making any actual investment decisions, based on the information published here. My reviews do not cover GMP market and operators game plans. Any reader taking decisions based on any information published here does so entirely at their own risk. Investors should bear in mind that any investment in stock markets is subject to unpredictable market-related risks. The above information is based on RHP and other documents available as of date coupled with market perception. The author has no plans to invest in this offer.

About Dilip Davda

Dilip Davda is veteran journalist associated with stock market since 1978. He is contributing to print and electronic media on stock markets/insurance/finance since 1985.

Dilip Davda is a leading reviewer of public issues and NCDs in the primary stock market in India. The knowledge he gained over 3 decades while working in the stock market and a strong relationship with popular lead managers makes his reviews unique. His detail fundamental and financial analysis of companies coming up with IPO helps investors in the primary stock market. Dilip Davda has a special interest in analyzing the SME companies and writing reviews about their public issues. His reviews are regularly published online and in news papers.

(Dilip Davda -SEBI registered Research Analyst-Mumbai,

Registration no. INH000003127 (Perpetual)

Email id: dilip_davda@rediffmail.com ).

The Adani Enterprises NCD September 2024 Analysis helps you to understand about the company, offer detail, valuation, capital structure and financial performance. Our SEBI registered NCD Analysts tells you if Adani Enterprises NCD September 2024 worth investing. The Adani Enterprises NCD September 2024 Note sets the NCD expectations in systematic way which tells you if Adani Enterprises NCD September 2024 good to buy (good or bad / yes or no). The NCD Forecast tells you weather to invest in Adani Enterprises NCD September 2024 by providing NCD recommendations i.e. subscribe, avoid and neutral.

Adani Enterprises NCD Sept. 24 Issue review (Apply)

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