“It is my commitment that we will continue to strive to keep improving these (governance standards) every single day,” he told shareholders at AEL’s 31st annual general meeting (AGM) while sounding upbeat about the conglomerate’s growth prospects amid India’s ambitious infrastructure spending plan and economic resilience.
“While the Securities and Exchange Board of India (Sebi) is still to submit its report, we remain confident of our governance and disclosure standards,” Adani said. Adani Group stocks have staged a sharp recovery after witnessing a massive $155 billion wipeout in investor wealth after the Hindenburg report was published on 24 January.
Most of the recovery in Adani Group’s 10 listed firms’ shares came after US-based investment manager GQG Partners Llc invested $1.87 billion in four key Adani Group firms on 3 March. The Rajiv Jain-led firm has pumped in over ₹24,500 crore in various Adani firms over the past three months.
From their lows after the Hindenburg report, stocks of most of the Adani Group firms have recovered 50-100%, while recouping $44 billion in total market capitalization as of Tuesday.
“It is worth noting that even during this crisis, not only did we raise several billions from international investors, but also that no credit agency—in India or abroad—cut any of our ratings,” he said, adding that the group is confident of boosting its balance sheet during the ongoing fiscal. “Our balance sheet, our assets, and our operating cash flows continue to get stronger and are now healthier than ever before.”
Until the release of the Hindenburg report, Adani Group stocks saw a meteoric rise, with many of them rising by as much as 50-fold in just four years. AEL’s stock surged from ₹143 on 23 January 2019 to ₹3,436.35 on 23 January 2023. Similarly, Adani Total Gas Ltd rose more than 40-fold from ₹96.8 to ₹3,901.1 during the same period. Adani Green Energy Ltd soared 50-fold from ₹37.95 to ₹1,931.85, and shares of Adani Transmission Ltd rose by 13-fold from ₹207.6 to ₹2,784.1 during the period.
Analysts attributed the exceptional surge in stocks to the group’s ambitious expansion plan, most of which was drawn after the Narendra Modi-led government came to power in 2014 and got re-elected for another term in 2019’s Lok Sabha polls.
“The pace at which we have made acquisitions and turned them around is unmatched across the national landscape and has fuelled a significant part of our expansion,” Adani said. “Our national and international partnerships are proof of our governance standards. The scale of our international expansions is validated by our success in Australia, Israel, Bangladesh, and Sri Lanka,” added Adani, whose overseas businesses span mining, infrastructure, and logistics.
Adani, once ranked the second-richest person globally but currently at No. 22 in the Bloomberg Billionaires Index following the Hindenburg setback, said: “The future of work, learning, medicine, and in some ways, of economic growth itself will need to be reset.”
As the group deleverages itself to assuage investor and creditor concerns, Adani said that during fiscal year 2023, the conglomerate’s accelerating cash flows improved the group’s net-debt-to-run-rate-Ebidta ratio (leverage ratio) from 3.2 times to 2.8 times.
Ebitda stands for earnings before interest, taxes, depreciation, and amortization.
During FY23, the group’s total operating income (Ebidta) grew by 36% to ₹57,219 crore, while its total income grew by 85% to ₹2.62 trillion, and total net profit increased by 82% to ₹23,509 crore.
“Our flagship company, AEL, continued to successfully demonstrate its incubation capabilities with new businesses accounting for a massive 50% of its Ebitda in FY23,” said Adani, who runs the country’s busiest airport in Mumbai and is aiming to operationalize another airport in Navi Mumbai by 2024.
“Of the several projects underway, two of the key ones include the Navi Mumbai Airport and the Copper Smelter. Both are on schedule. The Navi Mumbai Airport is preparing for operational readiness and airport transition by December 2024,” said Adani, whose group received the first regulatory clearance to redevelop Asia’s largest slum spread across 590 acres in Dharavi, Mumbai, involving an investment of over $3 billion, on Friday.
“By 2030, we intend to be not only the most profitable port company in the world but also India’s largest transport utility capable of handling a billion tonnes of cargo annually. By then, Adani Ports & SEZ (APSEZ) Ltd will be carbon-neutral and will also have tripled its Ebitda. In the next 12-24 months, APSEZ will commission India’s largest transhipment hub in Vizhinjam and also a port in Colombo,” said Adani.
Adani said the group will grow the capacity of its data centre joint venture AdaniConneX to 1 gigawatt (GW) in the medium term.
“This is by far the largest order book in India,” said Adani, adding that in combination with the group’s green power, this venture will be a “game changer as computation becomes the most precious resource in the world.”
The group had earlier envisaged a $50 billion investment in developing green energy capabilities by 2030.
On Tuesday, Adani said his group will play a critical role in India’s “net zero” journey as it keeps focused on producing the lowest cost green electron at scale. “…and I would like to reaffirm our target of 45GW of renewable energy capacity by 2030,” said Adani, whose group firm Adani Green has recently commissioned the world’s largest hybrid solar-wind project of 2.14GW in Rajasthan.
“We are now building the largest hybrid renewables park in the world—right in the middle of the desert—in Khavda. Spread over 72,000 acres, this project will be capable of generating 20GW of green energy,” said Adani, adding that this will be the most complex and ambitious project that the group has ever executed.
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Updated: 19 Jul 2023, 12:02 AM IST