Adani Group is "deeply overleveraged," with the group investing aggressively across existing as well as new businesses, predominantly funded with debt, the research report reportedly cited.

The aggressive expansion pursued by the Adani Group has put pressure on its credit metrics and cash flow, the research firm said, adding that "In the worst-case scenario, overly ambitious debt-funded growth plans could eventually spiral into a massive debt trap, and possibly culminate into a distressed situation or default of one or more group companies," it added.

The group's aggressive plans, most of which have been fuelled by debt, is making the research firm 'cautiously watchful'.

The research firm has, however, reportedly retained the 'Market perform' recommendations on the two Adani Group companies under their coverage Adani Green Energy and Adani Ports and SEZ.