Adani Group Has A Plan To Invest Rs 7 Lakh Crore Over 10 Years, Says CFO
The majority of growth in capex for the conglomerate comes from internal cash accruals, says Jugeshinder Singh .
The Adani Group will spend Rs 7 lakh crore in capital expenditure over the next 10 years as it seeks to further consolidate its lead as a major infrastructure player in India.
The group's chief financial officer said at an industry event on Friday that it has the capacity to invest Rs 20 lakh crore, but flagged lack of high-quality vendors as an impediment for such a move.
"As we develop the vendor pool, our capex will go up. If we manage our core strength of execution and operations to develop and run infrastructure properly, in a 25-year period we will invest up to Rs 80 lakh crore," Jugeshinder Singh said.
He said the majority of growth in capex for the conglomerate comes from internal cash accruals and sees the potential of expanding its operation and vendor pool further.
Fundraising Plans
Six Adani Group businesses—from power and ports to airport—will be tapping the bond market to raise funds for the mega investment plans, according to Singh. The group, he said, will raise 80% of its funds through debt issuances in global capital markets and the rest via domestic sources.
While raising long-duration infrastructure capital is challenging domestically, he said the group expects Indian capital markets to mature over time to be able to pool in resources.
The flagship company of the Adani Group—Adani Enterprises Ltd.—has over the years developed infrastructural assets spanning across mining, airports, defence and aerospace, solar manufacturing, roads, metro and rail, edible oil and food, agro, water, data centres, and resource management.
The ports business, Adani Ports and Special Economic Zone Ltd., has reported threefold growth in fiscal 2023, with the Indian ports business clocking an Ebitda margin of 70%, according to a company presentation.
The conglomerate has also expanded its renewables arm, Adani Renewables, which has seen growth of four times and an Ebitda margin of 92% earned from power supply in fiscal 2023.
Adani Energy Solutions Ltd., formerly known as Adani Transmission, has seen threefold growth in the last fiscal.
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