Adani Group to invest over Rs 1.2 lakh crore in FY 2024-25

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Adani Group plans to invest more than Rs 1.2 lakh crore across its portfolio companies in the Financial Year 2024-25, news agency PTI said, citing sources.  The investment will be made in ports, energy, airports, commodities, cement, and the media business. 

In December last year, Adani Group Chairman Gautam Adani said his group would invest $100 billion in 7-10 years in green energy transition over a decade. 

The projected capital expenditure for the 2024-25 (April 2024 to March 2025) fiscal is 40 per cent higher than what the portfolio is estimated to have incurred in FY24. According to analysts, the portfolio is estimated to have incurred a capex of around $10 billion in FY24 which ends on March 31.

The conglomerate has already announced $100 billion capex over the next 7-10 years. Most of this investment is going to go into group fast-growing businesses — renewable, green hydrogen, and airports, the report said.

As much as 70 per cent of the planned capex will go into its green portfolio — primarily renewable power, green hydrogen, and green evacuation. Of the remaining 30 per cent, the majority will reportedly be spent on airports and port businesses.

In calendar year 2023, the portfolio delivered a $9.5 billion EBITDA (up 34.4 per cent year-on-year), while its net debt has reduced by 4 per cent from March 2023 to September 2023. 

In the December quarter, Adani’s portfolio reported record EBITDA growth of 63.6 per cent, taking its 12-month EBITDA to an all-time high of $9.5 billion (Rs 78,823 crore) in 2023.

Sources told the news agency that increasing cash flows from fast-growing profits have set the stage for mega-scale investments. Its net debt to EBITDA at the end of September was 2.5x, which is expected to decline by the end of FY24, they said.

The group had in February said increasing cash flows from strong growth and robust credit profile has set the stage for unrivalled ‘Green Investment’. “Adani portfolio is committed to USD 100 Bn investments, primarily for green energy transition,” it said in a statement. 

The conglomerate said the performance of the past 12 months reveals the strength of the group portfolio that “can thrive under diverse external circumstances”. “With surging cash flows from consistently rising profits and conservative leveraging, the portfolio is well-poised to propel strategic investments on an unprecedented scale,” it had said.

The group also said that its cement company Ambuja has committed a significant investment of Rs 6,000 crore for renewable power projects, targeting a capacity of 1,000 MW, primarily for captive use.

Adani Group is the world’s second-largest solar power company, the largest airport operator with 25 per cent of passenger traffic and 40 per cent of air cargo, the largest ports and logistics company with 30 per cent of national market share, the largest integrated energy player, and the second largest cement manufacturer.

With a strong emphasis on green energy transition, Adani will be allocating more than 70 per cent of this $100 billion to its green businesses including renewable power, green hydrogen, and green evacuation transmission lines, sources told the agency.

Adani is building the world’s largest renewable park at Gujarat’s Khavda, spanning over 530 square kilometers – an area five times the size of the city of Paris. A large portion of total investments is earmarked for expansion and development of its fast-growing airports business and ports business, they said.

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