In its biggest fund-raising excercise, Adani Group is set to raise $2.5 billion (Rs 15,000 crore) from investors in India and abroad. Within a quarter, the group will raise $1 billion (Rs 6,000 crore) by selling new shares of Adani Enterprises, the group’s flagship firm, and an additional $1.5 billion (Rs 9,000 crore) from banks abroad to fund various projects.
With a pro-business government taking charge at the Centre, Adani Group companies have seen an unprecedented boom in their stocks. Shares of Adani Enterprises have jumped 235 per cent since Narendra Modi was named the Bharatiya Janata Party’s prime ministerial candidate in September 2013.
Of its $1.5-billion foreign loan, the group has already raised $500 million (Rs 3,000 crore) to refinance the loans it had taken to acquire a coal and port project in Australian. The group is raising funds for its $15.5-billion coal mining project in Australia, as well as its ports and power projects in India. Adani Group also needs funds for its Rs 5,500-crore takeover of Dhamra port from Larsen & Toubro and Tata Steel.
An email to Adani group did not elicit a response.
Insiders say the fund-raising will help Adani Enterprises and other group companies to expand operations. Analysts say the Modi government’s first Budget is expected to provide a major boost to the infrastructure sector, which will help companies in this sector bag new projects. The group delivered a good performance for the quarter ended March. Adani Enterprises reported a fivefold in increase in consolidated profit at Rs 2,848 crore, primarily driven by the company’s power business, which recorded additional revenue because of compensatory tariff for two projects. During the March quarter, contribution of the power business rose 200 per cent compared to the year-ago period; sales rose 40 per cent to Rs 16,171 crore.