SBI Struggles with Finance as Adani thrives in borrowings

21 Jul 2022  Read 468 Views

SBI's spending habits on sinking businesses might finally be catching up to it (looking at you, Yes Bank)!🙄 The bank acquired board permission to borrow ₹11,000 crore through various convertible and non-convertible debt instruments. Reportedly, the loans will be acquired to meet regulatory requirements and support business growth. Now, correct me if I'm wrong... but aren't businesses supposed to fulfil these requirements with their own funds? Then how does a bank (a literal money business) run out of funds like that?

So much for the "largest bank" in the country with a 25% market share in deposits and loans...

Well, if I were to cut the old-time finance giant some slack, I'd shift my sight to a recent siphon of the bank's reserves. You couldn't guess who in a 100 tries unless you got lucky! It's the Adani group! The multi-business conglomerate has borrowed close to ₹32,000 crore from poor old SBI in the last 4 months. The funds have been used for the following ventures:

  • Greenfield International Airport project @ ₹12,770 crore.
  • Copper Refinery in Mundra @ ₹6,071 crore.
  • PVC Plant in Mundra @ ₹14,000 crore.

But why would Adani Group, with the richest man in Asia go to a pseudo-sarkari bank for so many loans? Ask the boss for some funding, no?

The simple answer; poor fund management. I suppose they could take a page out of my impeccable finances. I always know where I want to spend my money, and I'm done spending it all before the calendar even reaches the 15th of the month!

About the Author: Deb P Samaddar | 248 Post(s)

Deb is a keen learner and eager to learn about the finance world. He is that person who would never stop talking, but my oh my, the words he uses, are not something a normal human would in a regular conversation. While the conversations are well, interesting, the write-ups are faultless. With an increased proclivity towards tech and language, he aims to capitalise on his interests as a content writer at Finology.

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