CARE upgrades Adani Enterprises to 'AA', retains 'stable' outlook

CARE Ratings has upgraded the long-term rating of Adani Enterprises to 'AA', affirming a stable outlook. This elevation underscores enhanced financial adaptability, attributed to recent capital influx and subsidiary stake divestitures. With profit growth likely, supported by a resurgence at Kutch Copper Limited and continued airport operations, coupled with the promoter family's substantial holdings, Adani's strategic significance is reinforced.

MUMBAI: CARE Ratings has upgraded the long-term rating for Adani Enterprises (AEL) to 'AA' from 'AA-', while retaining a 'stable' outlook for the flagship company of the Adani Group. This is the highest-ever rating for the company.

The upgrade by CARE reflects Adani Enterprises' improved financial flexibility, following a Rs 15,000-crore qualified institutional placement in July, and a 5.5% stake sale in its subsidiary Adani Airports Holding Ltd at a pre-money valuation of Rs 1.67 lakh crore.

"Rating upgrade also factors in likely expansion of profit before interest, lease, depreciation and tax of AEL in FY27 supported by stabilisation of operations at Kutch Copper Limited, continued growth in non-aero revenue across airports and commencement and progressive ramp-up of operations at Navi Mumbai International Airport Limited," the rating agency said on Wednesday.

"Strengthened financial flexibility of the Adani group, and the promoter family's substantial ownership across key group entities, enhances strategic importance of AEL and promoters' economic incentive to support diverse ventures of AEL in case of exigencies," CARE said.

Earlier in August, Adani Group Chairman Gautam Adani had called for a fundamental overhaul of

infrastructure rating frameworks, urging analysts to widen their scope of analysis in line with the sophistication of the infrastructure being built in the country.

India did not need lower rating standards but needed "wider lenses" to assess a new generation of infrastructure projects that create capabilities and ecosystems beyond their standalone cash flows, Adani had said as the keynote speaker at CareEdge Group Annual Summit in Mumbai.

"This upgrade serves as an independent validation of AEL's disciplined

capital management and tight fiscal prudence," Adani Enterprises said in an exchange filing. "AEL has constantly strengthened its credit profile over the last 7 years whilst executing an ever-increasing core infrastructure-led capex."

Rating agency ICRA has a 'AA-' rating for the company with a 'stable' outlook.