Gautam Adani, chairman and founder of Adani group
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Gautam Adani, chairman and founder of Adani Group, remains unperturbed about the shock and jitters the companies experienced in the beginning of this year as an investigative report by US-based Hindenburg Research raised questions on its financial health.
He remains confident of the growth plans of his companies, even as stock prices of Adani Enterprises are yet to fully recover after a massive sell-off dragged them down nearly 70 percent. Slamming the Hindenburg report, Adani says it is a combination of “targeted misinformation and discredited allegations”, dating from 2004 to 2015. “They were all settled by the appropriate authorities at that time. This report was a deliberate and malicious attempt aimed at damaging our reputation and generating profits through a short-term drive-down of our stock prices,” Adani says, addressing the annual general meeting on Tuesday. While the company had promptly issued a comprehensive rebuttal, various vested interests tried to exploit the claims made by the short-seller, he says, adding that these entities “encouraged and promoted false narratives across various news and social media platforms”.
In February, Adani Enterprises had unexpectedly withdrawn its follow-on public offer (FPO) worth Rs 20,000 crore, a day after it had successfully closed the offer. The decision triggered a 28 percent sharp sell-off of shares, and the company returned money to the FPO investors. What followed was nothing short of a roller coaster ride as investors continued to dump its shares, along with shares of other group companies like Adani Total Gas, Adani Transmission and Adani Green Energy.
Currently, the share price of Adani Enterprises is still down by more than 20 percent from 24 January, a day before the Hindenburg report was released. The stock had slipped to Rs 1,017.1 on February 3 and has picked up gradually since then.
The Hindenburg report also led to further probes on Adani Enterprises in India, which included the Supreme Court constituting an expert committee; the committee’s report was made public in May. “The expert committee did not find any regulatory failure. The committee’s report not only observed that the mitigating measures undertaken by your company helped rebuild confidence but also cited that there were credible charges of targeted destabilisation of the Indian markets. It also confirmed the quality of our group’s disclosures and found no instance of any breach,” Adani tells shareholders.
While market regulator Securities and Exchange Board of India (Sebi) is yet to submit its report, Adani is confident of their governance and disclosure standards. “It is my commitment that we will continue to strive to keep improving these, every single day,” he adds. What also gives Adani confidence is that even during the 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.”Also read: Inside the shaken house of Adani
The total Ebidta of Adani Group companies grew by 36 percent to Rs 57,219 crore in FY23 on an income growth of 85 percent at Rs 2,62,499 crore, while net profit surged 82 percent to Rs 23,509 crore. The Group’s accelerating cashflow improved net debt to run rate Ebidta ratio from 3.2 times to 2.8 times. In March, Adani Group executed a secondary transaction of $1.87 billion with GQG partners.
Here are key takeaways from his AGM speech:
New businesses accounted for a massive 50 percent of its Ebidta in FY23. Key projects include the Navi Mumbai Airport and a copper smelter. The Navi Mumbai Airport is preparing for Operational Readiness and Airport Transition by December 2024. Data centre JV AdaniConneX is on course to set up 350 MW capacity in the short term, and 1 GW capacity in the medium term.
Adani Green Energy
Adani Green Energy commissioned a hybrid solar-wind project of 2.14 GW in Rajasthan. Its renewable energy portfolio has grown by 49 percent to over 8 GW, which is the largest operational renewable portfolio in India. The company has set a target of 45 GW of renewable energy capacity by 2030. The company is now building the largest hybrid renewables park in the world, in Khavda, Gujarat. Spread over 72,000 acres, this project will be capable of generating 20 GW of green energy.
It has an Ebidta margin of 70 percent and by 2030 the company intends to be India’s largest transport utility, capable of handling a billion tonnes of cargo annually. By then, it will be carbon neutral and will also have tripled its Ebidta. In the next 12 to 24 months, it will commission India’s largest transshipment hub in Vizhinjam, Kerala, and also at a port in Colombo, Sri Lanka.
It has commissioned a 1.6 GW ultra-supercritical thermal power plant in Godda, Jharkhand, and is now supplying power to Bangladesh.
It aims to make Mumbai run on 60 percent renewable power, making it the first mega city in the world to achieve over 50 percent power supply from solar and wind.
Adani Total Gas
Adani Total Gas expanded access to clean cooking fuel to 1,24,000 households this year with a 46 percent increase in revenue to Rs 4,683 crore.