Daily Brief Credit: Adani Ports – Earnings Flash – 9M FY 2022-23 Results – Lucror Analytics and more

Adani Ports and Special Economic Zone’s 9M/22-23 results were broadly stable. The main takeaway was management’s commitment to reduce debt by INR 50 bn using FCF in FY 2023-24, supported by lower capex and limiting new acquisitions. This would cover the INR 16 bn in repayments for onshore bonds maturing in H1/23-24, as well as the prepayment of certain bank debt. Management expects the company to generate the same amount of FCF in FY 2024-25, which would be channelled to repay the USD 650 mn ADSEZ 3.375 24 due in July 2024.

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

• Adani Green Energy
• Lippo Karawaci

Tata Steel has reported significantly weaker than expected Q3/22-23 results. This was driven by a material loss in the European business. Meanwhile, the Indian operations remained reasonable. The consolidated financial risk profile deteriorated significantly, albeit Net Debt/EBITDA remained within the company’s long-term target. Liquidity is adequate.

The next few quarters are likely to be weaker for Tata Steel in Europe, as markets remain subdued. Steel prices are projected to weaken in Q4/22-23, with the drop likely to be steeper than the decline in coking coal and iron ore prices.