The Adani group’s airport expansion will continue as planned despite its flagship company withdrawing a ₹20,000 crore capital raise in February, the group’s airline business chief said.
“Any financing is a group decision. We are continuing with all our projects. We are following the investments as per the plan submitted to the government,” Arun Bansal, chief executive of Adani Airports Holding Ltd, said on the sidelines of the CAPA India Aviation Summit.
Adani group companies came under the spotlight in February after US short-seller Hindenburg Research alleged accounting fraud and stock manipulation at the group, charges that the conglomerate has denied. The allegations triggered a massive selloff in all group company stocks, rating agencies put Adani group companies under watch, and the turmoil led to the withdrawal of Adani Enterprises’ follow-on public offering (FPO).
A fourth of the total FPO proceeds were to be used to fund airport expansion plans, according to the company’s plans reported by Mint in February. Over ₹5,200 crore was to be used to upgrade airports in Ahmedabad, Lucknow and Mangaluru from January 2023 to March 2024; and ₹4,165 crore for repaying fully or in part, borrowings of Adani Airports Holdings Ltd, Adani Road Transport Ltd, and Mundra Solar Ltd. It had also planned to use ₹2,660 crore from the net proceeds of the FPO for green hydrogen projects.
On Wednesday, Bansal also said that the group is looking to expand its airport portfolio and will bid in the state-owned Airports Authority of India’s next round of the public-private partnership programme for airport development. The government is planning to bring private players into the operation, management and development of about 11-13 airports and is likely to invite bids for airport pairs, including one major and a minor airport each.
“We need to see how the tariff will be filed. There are pairings of one main airport and a smaller airport. Once the tender is out, we need to study how this will work… how the tariff will apply…whether it is the same or different for both airports. We will study and make a strategy. Our strategy is simple. It is to build scale, so if the bid condition is right for us, we will bid,” Bansal said.
For minor airports, the group will assess the merit of growth and the potential of an airport before deciding to bid for the same. “We will have to calculate how much capex we need to invest. If it makes sense, we will bid,” he said.
In February 2019, Adani won bids to upgrade and operate six government-owned airports—Lucknow, Mangaluru, Ahmedabad, Jaipur, Guwahati and Thiruvananthapuram—for 50 years.