The privatisation drive initiated by the BJP-led NDA is expected to continue uninterrupted despite coalition politics coming back, with the BJP depending on the crucial support from two regional stalwarts, N. Chandrababu Naidu of Andhra Pradesh and Nitish Kumar of Bihar.
“Coalition government or not, fundamentally, India’s structure has changed,” said Robbie Singh, Group CFO of Adani Group, which operates in the energy, utilities, transportation, and logistics sectors.
Exactly a month before the general election, when there was hype about the NDA crossing the 400-seat mark, the senior team of Adani Enterprises, which owns Adani Airports, was beaming with confidence.
“We will 100% bid for airports, which are in our core strength of the network that we want to develop,” said a senior management member in an investor call.
The government had earlier planned the privatisation of over a dozen airports. Interestingly, Adani Group was the biggest beneficiary in the last round of airport privatization. In fact, Naidu’s TDP has got the key portfolio of civil aviation.
“There is a much bigger motive of India, a much bigger motive for their people than this government or any other state government. You are not going to play politics with this,” said Singh, hinting that the privatization exercise is irreversible.
Singh reasoned that the capital expenditure has gone up from 1.2% of GDP to 3.3% in the last decade. Subsidies have gone down from 1.9% to 1.6% of GDP in the same period. “Petroleum subsidies have vanished for the first time in 75 years of Indian modern history,” he explained.
“Coalition or no coalition, the productivity movement is now here to stay. So that will continue,” said Singh.
He further stated that there will be no change in the government’s planning related to capital expenditure because the productivity gain has to be put into place to deliver a USD 10 trillion economy, and that will not be subsumed by political motives.
Adani Airport operates seven airports: Mumbai, Ahmedabad, Lucknow, Mangaluru, Jaipur, Guwahati, and Thiruvananthapuram, and a greenfield airport in Navi Mumbai.
It has concession agreements for a 50-year period with the Airports Authority of India (AAI) for the operation, management, and development of six airports, except Mumbai, where the agreement is for 30 years.
The eagerly awaited greenfield Navi Mumbai project is on track for completion in FY25.
Adani Airport Holdings , whose revenue grew by 35% to Rs 8,062 crores, with EBITDA growing by 45% to Rs 2,437 crores in 2023-24, is likely to be the next company to hit the IPO market in the next two years.
