SBI's exposure to Adani Group at Rs 27,000 crore or 0.88 pc of total loans, says chairman

The report by US-based short seller Hindenburg Research, accusing the Adani Group of stock manipulation and accounting fraud last week, has led to a sharp sell-off in shares of the various listed companies of the conglomerate and raised concern over the exposure that Indian banks have to the group.

Dinesh Khara, chairman of State Bank of India, the country’s largest lender, told reporters on Friday that the bank’s total outstanding exposure to Adani Group is about Rs 27,000 crore or about 0.88 per cent of its total loan book. As per SBI's balance sheet, its gross advances in the October-December quarter stood at over Rs 31.33 lakh crore, up 17.60 per cent from a year ago.

“Lent to Adani for projects which have tangible assets and have adequate cash flows,” Khara said.

He further said he doesn’t envisage any challenge in terms of the ability of the Adani Group to service the loans taken.

Since January 24, when the Hindenburg report was released, shares of the energy to airports conglomerate have taken a beating on the stock market. On Friday morning as the Adani Group stocks once again resumed their fall, their market cap fell below Rs 10 lakh crore, an over 50 per cent erosion since Jan 24.

Khara stressed that SBI has not given any loans to Adani Group against shares. He also added that there had been no refinance request from Adani Group so far.

On Friday, after falling in morning trading, some of the Adani Group stocks rebounded. Adani Enterprises ended the day up 1.25 per cent at Rs 1,584.20 and Adani Ports surged 8 per cent to Rs 498.85. Cement companies Ambuja and ACC also rose 6 per cent and 4.4 per cent respectively.

However Adani Power, Adani Transmission, Adani Total Gas, Adani Wilmar, Adani Green Energy and NDTV yet again hit their respective lower circuit limits.

SBI, on Friday, reported a 68.50 per cent year-on-year increase in its third quarter net profit at Rs 14,205 crore. It was the highest ever quarterly net profit reported by the state-owned lender.

Its net interest income surged 24 per cent from a year ago to Rs 38,069 crore. SBI’s asset quality also continued to improve, with its gross NPAs (non-performing assets) in the quarter declining 136 basis points to 3.14 per cent. The net NPAs stood at 0.77 per cent, down 57 bps.

SBI’s shares closed 3.1 per cent higher at Rs 544.45 on the BSE.