Credit rating agency Fitch Ratings has placed some bond programs of India’s Adani Group on a negative watch list, following the United States’ bribery allegation against the conglomerate. While Fitch has not altered Adani’s credit rating as of yet, the watch status indicates that it may be downgraded in the future.
The U.S. Justice Department recently charged two subsidiaries of the Adani Group with bribery, alleging that they made illegal payments to Indian government officials. Fitch Ratings stated that these allegations, if proven, could affect the Adani Group’s operations, which in turn could potentially impact its ability to repay its bondholders. The review process may take several months, during which Fitch will monitor developments related to these charges and their implications.
Please note that being on a negative watch list does not mean that the company will surely face a credit downgrade. It’s an indication that the bond might be downgraded, contingent on the unfolding of certain events or conditions. Fitch Ratings will keep a close watch on how the group handles this situation, and the ratings can either be affirmed or downgraded.
