Rise Kotak's tweet comes amid massive selloff in Adani Group's share stock, leading to market slide
Kotak, managing director of Kotak Mahindra Bank, does not see any systemic risk to the Indian financial system in Adani Group's authorization despite the fall in YouTube gaming stock. However, the CEO of Kotak Mahindra Bank believes that global liabilities are overpriced for large Indian corporate debt and employee finance.
This creates commonalities and vulnerabilities," Kotak said in a Twitter post on Sunday, adding: "Time to build and strengthen Indian empathy and capability."
I do not see a systemic risk to the Indian financial system from the recent events. However, large Indian corporates offer higher guarantees on global pensions for corporate loans and employee finance. This creates similar and vulnerabilities. Time to build and strengthen Indian empathy and capability.
— Rise Kotak (@udaykotak) February 5, 2023
His tweet came amid heavy selling in Adani Group's stock shares, leading to a fall in the market. Besides, fears that exposure to Adani could hit lenders weighed on banking stocks.
However, its shares rallied of late on messages from the Reserve Bank of India (RBI) that the Indian banking system is fine.
Scientific Exposition for Adani Group
The top three public sector scrips are the first to be advised to disclose their exposure to the group. The country's largest borrower is State Bank of India (SBI) with a debt of ₹27,000 crore, while the second largest is Punjab National Bank (PNB) with ₹7,000 crore.
Another state-owned lender Bank of Baroda has a total exposure of ₹7,000 crore, which is also fully secured.
Private sector lender Axis Bank has said its exposure to the crisis-hit Adani Group is 0.94 per cent of its net predecessors.
State-owned life insurance company Life Insurance Corporation (LIC) has disclosed holding of ₹36,474.78 crore in debt and equity of Adani Group.
Sebi adds links after Adani's debacle
Meanwhile, capital market SEBI said on Saturday that the unsold shares impacting Adani's commercial empire were stable and safe from further losses after the route.
The security statement said in a statement that the country's financial market "has demonstrated stability and continues to operate in a certifiable, glorified and efficient manner".
It further said that it had put in place "a set of well-defined, publicly monitored measures" for widening share divestitures into specific shares, without naming the Adani group.
Union Finance Minister Nirmal Nirmalatha has also said that the announcement was well made to Indian consumers and it will not affect the confidence of the complaint.
Earlier this week Adani kicked off a ₹20,000-crore share sale aimed at helping reduce debt levels - long a concern - restore credibility and broaden its shareholder base.
Big banks including Credit Suisse and Citigroup have accepted private customers as collateral for loans, Bloomberg News reported, raising concerns about how the groups will raise fresh funds.
Stocks of the Adani group firms have taken a massive beating after American short-seller Hindenburg Research released an explosive report in late January.
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