(Reuters) – Fitch Ratings has assigned a negative outlook to Indian energy infrastructure company Adani Energy Solutions Limited, citing concerns over corporate governance and potential risks from ongoing U.S. investigations.
The action comes months after U.S. authorities accused billionaire Gautam Adani and top Adani Group executives of paying $265 million in bribes for Indian power contracts and misleading U.S. investors during fundraising, charges the group has called “baseless”.
Adverse findings from the U.S. investigations could weaken governance standards and trigger a downgrade of the company’s rating in the near to medium term, Fitch said on Sunday.
It could cut the rating if the investigations lead to regulatory penalties, restrictions, or a loss of market confidence, the rating agency said.
Fitch removed the company from its ‘rating watch negative’ list, saying risks related to its liquidity and funding had moderated and affirmed its rating for Long-Term Foreign- and Local-Currency Issuer Default Ratings at ‘BBB-‘.
While Adani Energy operates independently, governance concerns at the Adani Group level could still impact its capital market access and liquidity, Fitch said.
(Reporting by Ashna Teresa Britto in Bengaluru; Editing by Mrigank Dhaniwala)
