India’s Adani Group plans to demerge more business; dismisses debt concerns

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The corporate house plans to divest, or divest, its metals, mining, data center, airports, roads and logistics businesses, Jugeshinder Singh said.

“The criteria is that these businesses get a basic investment profile and experienced management by 2025-28, which is when we plan to break them,” he said.

The company is betting big on its airport business and is aiming to become the largest service base in the country in the coming years, outside of government services, Singh said.

The Adani group has reduced its power, coal, transmission and green energy business in the last five-seven years.

Adani, the third richest man in the world according to Forbes, has been diversifying his empire from ports to energy and now owns a media company.

His parent firm Adani Enterprises is poised to raise up to $2.5 billion in a follow-on share sale, Reuters previously reported.

“We don’t go to market if we’re not sure we’ll raise the full amount ($2.5 billion),” Singh said, adding that the company wants to increase the participation of retail investors and is therefore going for a primary issue. instead of to a primary issue. a matter of rights.

The company plans to use the money to finance greenfield hydrogen projects, airport facilities and Greenfield expressways, in addition to reducing its debt, it said earlier.

The group typically incubated businesses within its parent company, to be split off and listed later. Its listed arms today operate in sectors including ports, power transmission, green energy and food production.

NO DEBT WORRIES

Analysts have raised concerns about its debt build-up that was ousted by Singh.

Adani Group’s total gross debt in the financial year ending March 31, 2022 increased by 40% to 2.2 trillion rupees. CreditSights, part of the Fitch Group, described the Adani Group in September 2022, as “overleveraged” and said it had “concerns” about its debt.

While the report later corrected some calculation errors, CreditSights said it retained concerns about leverage.

“No one has raised concerns about the debt to us. Not a single investor has. I am in contact with thousands of high net worth individuals and 160 institutions and no one has said this,” said Singh.

($1 = 80.9790 Indian rupees)

(Reporting by M. Sriram, Writing by Nupur Anand; Editing by Raju Gopalakrishnan)

By Sriram Mani

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