Singapore financial sector’s exposure to Adani limited so far
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Adani Group is India’s largest conglomerate, with businesses globally spanning ports, airports, manufacturing and energy.
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SINGAPORE - The Republic’s exposure to beleaguered Indian conglomerate Adani Group appears to be limited so far, checks made by The Straits Times have shown.
This includes the local banking sector, where overall exposure to Adani Group is small, said the Monetary Authority of Singapore (MAS).
MAS was responding to queries from ST on Nov 25 in relation to Singapore’s exposure to Adani Group, which is embroiled in a US indictment case
Adani Group is India’s largest conglomerate, with businesses globally spanning ports, airports, manufacturing and energy.
“Banks have in place measures to review and manage their exposures to borrowers and counterparties,” an MAS spokesperson said.
Prosecutors in the US are alleging that Adani Group’s chairman Gautam Adani, alongside seven others including his nephew, promised to pay bribes to Indian government officials to win solar energy contracts.
The bribes are said to be more than US$250 million (S$336.2 million) for solar contracts worth an estimated US$2 billion over 20 years. The prosecutors alleged that this plan was then concealed as the group tried to raise money from US investors.
The indictment was unsealed on Nov 20, triggering a US$27 billion plunge
Adani Group has said the accusations are baseless and that it will seek “all possible legal recourse”.
Adani Group has had a business presence in Singapore for over two decades. Its local office is the headquarters for the group’s operations in South-east Asia.
In February 2023, it was reported that Singapore investment firm Temasek, through its subsidiary Camas Investments, owns a small stake of just over 1.2 per cent in India-listed Adani Ports and Special Economic Zone. Temasek let go of those positions later in 2023, and currently has no investments in Adani, according to public documents on the Adani Ports website.
It was also reported in October 2022 that Adani was in early discussions with investors that included Temasek and Singapore sovereign wealth fund GIC to raise at least US$10 billion to fund Adani Group’s expansion into clean energy, ports and cement businesses. GIC declined to comment when contacted by ST.
Adani Group also runs an edible oil and food business in India through a joint venture with Singapore-listed Wilmar International.
Shares of Adani Wilmar, which is listed in India, are down by 10 per cent from Nov 20. Wilmar also declined to comment when contacted by ST.
The conglomerate’s troubles may also have an impact on the broader financial ecosystem.
One example is through the 770 environmental, social and governance (ESG) funds globally that have exposure to Adani Green Energy, which has lost about a quarter of its value since Adani was charged, Bloomberg reported.
ESG funds are investment funds that focus on companies that meet specific ESG criteria. ESG fund managers are expected to take extra measures to protect their clients from ESG risks. Such funds are also available to investors in Singapore.
Altogether, the 770 ESG funds oversee about US$400 billion and some of them are managed by the world’s largest asset managers, Bloomberg said. So far though, their holdings in Adani Green make up less than 1 per cent of the funds’ net asset value.
French oil company TotalEnergies, which bought a 19.75 per cent stake in Adani Green Energy in 2021, said on Nov 25 that it would not make any new financial contributions as part of its investments into the Adani group of companies, the company said in a press release.
