Adani Group in Rs 21k Cr Funding Talks with Sovereign Funds

The Adani Group, one of India’s largest conglomerates, is in advanced talks with sovereign funds based in West Asia to raise over Rs 21,000 crore ($2.6 billion) for its airport expansion and green hydrogen projects, according to a report by Business Standard.

Airport expansion of Adani Group

The Adani Group, which acquired six airports in India in 2019 and 2020, plans to invest Rs 18,000 crore ($2.2 billion) to upgrade and modernize them over the next five years. The group is also eyeing more airport assets in the country as the government plans to privatize more airports.

According to the report, the Adani Group’s flagship firm Adani Enterprises may reduce its stake in the airport-holding firm for investment funds, citing a source close to the development. The group currently holds 74% stake in the airport-holding firm, while the rest is owned by foreign investors.

The group aims to become India’s largest airport operator, with a combined annual passenger capacity of over 100 million. The group operates airports in Ahmedabad, Lucknow, Mangaluru, Jaipur, Guwahati and Thiruvananthapuram.

Green hydrogen project of Adani Group

The Adani Group is also looking to raise funds for its green hydrogen business, which is part of its renewable energy portfolio. The group plans to invest Rs 3,000 crore ($364 million) to set up a green hydrogen production facility in Mundra, Gujarat.

The facility will use renewable energy from solar and wind farms to produce green hydrogen, which can be used as a clean fuel for various industries and transport sectors. The group aims to become one of the world’s largest green hydrogen producers by 2030.

According to the report, the Adani Group may also dilute its stake in the green hydrogen business for investment funds, citing another source close to the development. The group currently holds 100% stake in the green hydrogen business.

The group has been expanding its renewable energy portfolio, with a target of achieving 35 gigawatts (GW) of renewable energy capacity by 2025. The group has also partnered with global energy majors such as TotalEnergies and Qatar Investment Authority for its solar and gas businesses.

Investor confidence

The fundraising talks come at a time when the Adani Group has regained investor confidence after facing allegations of wrongdoing by a US shortseller Hindenburg Research in January last year. The allegations had wiped off $150 billion in the value of shares in Adani Group companies and forced it to scale back some of its aggressive expansion plans.

However, a Supreme Court ruling that the group does not need more scrutiny, along with investments from Abu Dhabi conglomerate International Holding and US boutique investment firm GQG Partners have restored investor confidence.

In 2023, the Adani Group raised funds from various entities, including Qatar Investment Authority, TotalEnergies and GQG Partners. In January this year, the group said it would invest Rs 62,400 crore ($7.52 billion) in the Indian states of Maharashtra and Telangana as part of its seven trillion-rupee expenditure plan for the next decade.

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