MUMBAI, Jan 21 (Reuters) – India’s Adani Group, controlled by billionaire Gautam Adani, plans to spin off more businesses by 2028 and remove any debt concerns, the group’s chief financial officer told Reuters.
Jugeshinder Singh said the company plans to spin off or spin off its metals, mining, data centres, airports, roads and logistics businesses.
“The criterion is that these businesses achieve a basic investment profile and experienced management by 2025-28, which is when we plan to break them down,” he said.
Singh said the company is betting big on its airport business, aiming to become the country’s largest service base outside of government services within the next few years.
Over the past five to seven years, Adani Group has divested its power, coal, transmission and green energy businesses.
Adani, Forbes’ third-richest person in the world, has been diversifying his empire from ports to energy and now owns a media company.
His flagship Adani Enterprises (ADEL.NS) will raise as much as $2.5 billion in a follow-on stake sale, Reuters previously reported.
“If we were not sure about raising the full amount ($2.5 billion), we wouldn’t have entered the market,” Singh said, adding that the company wanted to increase participation from retail investors and was therefore looking at the main issue rather than the entitlement issue.
In addition to cutting debt, the company plans to use the funds to fund green hydrogen projects, airport facilities and greenfield highways, the company said earlier.
The group typically incubates businesses within its flagship company, which is then spun off and listed. Today, its listed subsidiaries operate in sectors such as ports, power transmission, green energy and food production.
no debt problems
Analysts have raised concerns about its debt buildup, but Singh dismisses it.
Adani Group’s total debt rose 40% to Rs 2.2 trillion in the financial year ending March 31, 2022. CreditSights, a unit of Fitch Group, described Adani Group as “overleveraged” in September 2022 and expressed “concerns” about its debt.
While the report has since corrected some calculation errors, CreditSights said it remains concerned about leverage.
“No one has raised the debt issue with us. Not a single investor has raised it. I’ve been in touch with thousands of high-net-worth individuals and 160 institutions, and no one has ever said anything like this,” Singh said.
($1 = 80.9790 Indian Rupees)
Reporting by M. Sriram, Writing by Nupur Anand; Editing by Raju Gopalakrishnan
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