Adani into Debt Trap?
Adani into Debt Trap?
Adani into Debt Trap, Credit rating agency Fitch has rated Adani Group as Over-leveraged which has raised concerns among investors as it has been one of the best-performing stocks in the country in the past few years and this report has put the future of the company in jeopardy.

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Adani Group’s shares have seen a 500-5000% jump in the last 3 years but currently, Adani stocks seem to be under pressure as they are currently down by almost 5 percent and are expected to fall even more after a research report by Fitch rating’s CreditSight which says that Adani Group is “deeply overleveraged. In other words, Adani Group's debt is unviable high against its equity.

Adani Group's total debt of 2.2 lakh crores as of March 31 is a result of the company’s aggressive expansion which is majorly funded by debt and has put enormous pressure on the credit metrics and cash flows of the company.

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It is also noticeable that the company is venturing into new and unrelated businesses which are capital intensive and may not generate profits initially which in the worst-case scenario can spiral the company into a debt trap and possibly a default.

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