Adani group releases ₹26,500 crore pledged shares in FY24, improves company’s cash flow

The Adani Group has released ₹26,500 crore worth of pledged shares in the financial year 2024. This move is considered as a positive development by analysts as it improves the company’s cash flow and smoothens the market concerns about pledged shares. In March 2023, Adani Power had pledged 72.72 crore promoter shares, which has now reduced to 44.56 crore.

The company has been rigorously working to improve its cash flow in recent years. The company frees up the capital by reducing the amount of pledged shares. This capital is further used for investment and growth, thereby improving the company’s financial position and reducing debts. Analysts attribute this trend to improved cash earnings, following similar releases of over ₹15,000 crore each in FY23 and FY22 and ₹1.27 lakh crore in FY21.

The release of shares included shares from three significant companies:

a. Adani Power: The company had 72.72 crore pledged shares in March 2023. This number fell to 44.56 crore by March 2024, signifying a release of roughly 28.16 crore shares with a value of ₹15,000 crore.

b. Adani Ports & SEZ: The company held 6.14 crore pledged shares in March 2023. This number dropped to 2.42 crore, representing a release of around 3.72 crore shares worth ₹4,989 crore by March 2024.

c. Adani Green Energy: The company’s promoter-pledged shares went from 3.17 crore in March 2023 to 90.8 lakh in March 2024. This reflects a release of 2.26 crore shares worth ₹4,149 crore.

Impact on share price

Ahead of this news of release of shares, the shares of Adani Power traded 1.49% lower at ₹589.20 at 11.45 PM on April 19, 2024. On the other hand, the shares of Adani Ports traded 0.27% higher at ₹1,299.10 and the shares of Adani Green Energy traded 1.25% lower at ₹1,753.30 on April 19, 2024.