Adani Group stocks: Confusion over Adani FPI a/cs freeze: CFO offers an explanation
The comment came after the Adani group first denied the ET report, calling it “blatantly erroneous” on Monday, but later clarified to stock exchanges that three demat accounts of Albula, APMS and Cresta were “suspended for debit,” adding to the confusion over the status of the FPIs.
In an exclusive interview to ET NOW, Singh said his group was pushing forward its investor management program and is opening up shares to new investors.
Asked whether he was worried about some funds having 75-80 per cent of concentration in Adani group stocks, Singh said the investment risk lies with funds themselves and clarified that his group remains a core investor in businesses and is an inter-generational investor.
“Other than us, we continue to expand our relations with strategic investors. Our key focus remains on the underlying performances of our businesses. We have built solid businesses and they are massively cash flow-positive and generate higher profit and ebitda margins,” Singh said.
In Adani Total Gas, Jugeshinder said Adani family owned 37.4 per cent and strategic investors, including BlackRock held 42 per cent. “As our companies mature, as is the case with Adani Ports, it would be reflective of wider participation by strategic infrastructure investors. We are confident that it would be achieved in the next 3-5 years,” he said.
Singh said his companies were committed to maintaining high credit quality. The companies, he said, want to invest as long as they can do so at a return higher than the risk-adjusted cost of capital, such as Adani Green’s recent $3.5 billion acquisition of SB Energy.
Singh said Adani’s utility platform includes four companies, Adani Power,
, Adani Transmission, Adani Total Gas and one that supports manufacturing. At the platform level, the group is growing at over 12 per cent. The debt-to-ebitda in the energy and utility business is just over 4 times against the global average 5 times,” he said.
Singh said Adani Green’s business has grown 50 times since inception in 2015-16.
, he said, is an incubator business and does not directly hold a stake in the group companies, he said.
“Our airport, road, data center and water businesses are all with Adani Enterprises. Besides, solar and renewable manufacturing clusters are also within Adani Enterprises. Once they achieve a certain scale and mature, we will at an appropriate time demerge those. Adani Enterprises does not have a gross shareholding relationship with any of our listed verticals,” Singh said.
Singh said all of the group companies fall into mature, high cash flow categories. Adani Ports, he said, saw 38 per cent growth in non-Mundra Port business in the last 5 years. Adani Ports’ logistic business has grown in high double digits.
Transmission & distribution businesses, Singh said, are growing at double digits. Adani Green, he said, has excess cash flows but the company would keep investing and would think of distributing dividends by FY23-24.
He said his group would look at an IPO for its airports business once the core performance strengthens.
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