Adani to unlock value in airports, data centres in future, says group CFO

AEL will be investing $70 billion in incubating new businesses and at the group level we will be investing close to $107 billion in the next decade, Singh says

Adani Enterprises (AEL), the flagship company and business incubator of Adani Group, is set to launch its Rs 20,000-crore follow-on public offer (FPO) on Friday. AEL will use the money raised to fund green hydrogen projects, airport facilities, and greenfield expressways, besides paring some of its debt. It will sell shares in a price band of Rs 3,112-3,276 apiece in the FPO, slated to open on January 27 and close on January 31. Group Chief Financial Officer JUGESHINDER ‘ROBBIE’ SINGH, in conversation with Dev Chatterjee and Krishna Kant, talks about the need for more retail investors participating in India’s growth story and the group’s plans to invest $107 billion in the next decade in infrastructure and green energy projects. Edited excerpts:

Equity investors, as a percentage of total population, are still low. Why do you think retail investors need to participate in the AEL issue? 

We are a home-grown company with diverse businesses. Investors can look forward to strong businesses emerging from our company in the future. We will unlock value in airports and data centres in the future. When you travel within India, you can see these assets for yourself. These are tangible assets like hydrogen, airports, and data centres.

With the FPO, these assets will now be owned by Indians. That is an important underlying message on wealth creation and from a national perspective that our core infrastructure will be owned by Indians.

The Indian household wealth is close to $15 trillion right now. All the equity investment combined represents less than 2 per cent of this. If they invest now, they will automatically get shares in Adani airports and in the data centre business in the future. 

Adani Group is planning to invest a massive $107 billion in new projects like green energy, road, and infrastructure in the next decade. Will you raise equity from overseas and list any of these businesses beyond Indian shores?

AEL will be investing $70 billion in incubating new businesses. At the group level, we will be investing close to $107 billion. We are an Indian company and we have to find a way to make sure capital formation in India becomes high. We must find a way to monetise Indian wealth by offering good governance, good returns, good ratings, and proper disclosures.

We believe Indians must remain owners of our equity. We believe our core capital can come from India itself. If we get equity capital from India, then 3x the equity capital is available as debt. Consequently, massive capital formation can take place in our country. 

We have seen huge reforms in India in 30 years. In recent years, several microeconomic and structural reforms have been carried out by the Narendra Modi government. Digitisation, direct beneficiary, and goods and services tax are positive reforms that have benefited the population.

Most of our businesses are capable of raising capital overseas. Adani Green is already registered with the US Securities and Exchange Commission. We can easily list it because we follow world-class governance standards and make full disclosures.

We are one of the few companies to have raised debt in the US. But we want to make sure wealth creation happens in India for Indians. We will remain listed here and stay an Indian company.

The Indian government is planning to privatise more airports. Will Adani Group participate in the next round?

The government hasn’t made a final decision so far. The government is planning to add non-viable airports to relevant ones. You simply will not be able to buy just the main airport. For instance, you won’t be able to buy just Amritsar airport; you’d have to take over another non-viable airport with it.

The process and timelines have not been outlined by the government as yet. Once the government’s plans are clear and if the Competition Commission of India permits, we would like to expand our network.

Will you be looking at acquiring road projects in India, given several companies are selling their road assets?

We are interested in developing and constructing road projects from scratch like the Ganga Expressway project.

Most road projects on sale have already been developed. Therefore, if the acquisition is just for financial returns, we are not interested. But we believe that if a project allows us to bring in our development wherewithal and enhance returns, we may consider it.