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Adani Group aims to concentrate enough cash, both from ordinary operations in the infrastructure industry and from reserves, to pay off any obligations that are due in the future. The primary goal is to achieve a substantial financial status by 2025. The main reason for using this method is to avoid borrowing any debt, avoid any potential threats from the market or economy, or, as a result of a spillover effect from global events, eliminate all controversies surrounding Adani shares overleveraged.
For the fiscal year 2022-2023, the present funds in the bank and free cash flow are approximately Rs. 77,889 crore. With a revenue of Rs. 2.62 lakh crore, the group is recalibrating its growth strategy by slowing acquisition velocity and reducing debt. Non-core assets are also being set aside.
The Adani Group’s strategy aims to gather adequate funds
The Adani Group aims to accumulate enough funds, including reserves and cash from ongoing infrastructure works, to pay off any future loans. It plans to reach this financial position by 2025. This method is largely used to ensure that no debt needs to be refinanced and to eliminate any risk associated with the market, the economy, or the fallout from big international events. The free cash flow and cash in the bank for 2022-2023 are currently at Rs. 77,889 crore.
The current gross debt is approximately Rs. 2.27 lakh crore, with an asset base of approximately Rs. 4.22 lakh crore. Furthermore, despite the Adani shares overleveraged scandal, the Group was able to reduce net debt to EBITDA leverage from 3.8x in 2021-2022 to 3.3x in 2022-2023. The company, which made Rs. 2.62 lakh crore in revenue, is revising its growth strategy by slowing acquisitions and paying down debt. Non-core assets are also set to be sold.
In fact, the financial services division was sold in August 2023. Adani Enterprises (AEL), Adani Ports & SEZ (APSEZ), Adani Transmission (ATL), and Adani Green Energy (AGEL) raised $1.87 billion from GQG Partners by selling shares in four of their businesses. Three of the Group’s companies have also received approval from their boards to raise $4 billion over the next year.
Despite global issues such as climate change, geopolitics, supply chains, energy, and inflation, India is expected to grow. Adani currently has ten companies in its portfolio. By 2033, this figure is expected to rise to 14-15 firms. The portfolio will still include some shares held by the promoter family, according to the company. According to the company, capital recycling within this portfolio should not be interpreted as dilution.
All of Adani’s stocks, with the exception of ATL and ATGL, are already on the mend. The company diluted $5.79 billion in stock over the previous four years to include major international participants such as TotalEnergies, Qatar Investment Authority, and Abu Dhabi-based IHC business.
The Group is revising its growth strategy
With Rs 2.62 lakh crore in revenue, the Group is recalibrating its growth strategy by slowing acquisitions and reducing debt. Non-core assets will also be disposed of. In fact, the financial services division was sold in August 2023. Adani Enterprises (AEL), Adani Ports & SEZ (APSEZ), Adani Transmission (ATL), and Adani Green Energy (AGEL) raised $1.87 billion via the worldwide venture capital firm GQG Partners by selling shares in four of its subsidiary companies: Adani Enterprises (AEL), Adani Transmission (ATL), and Adani Green Energy (AGEL).
The Adani shares overleveraged controversy has boosted the Group’s confidence. The Adani group of companies and its promoters intend to raise $50 billion in equity over the next two decades. This raise is in addition to the internal funds of the individual companies, which total around $100 billion. As a baseline, the goal is to invest nearly $500 billion in core infrastructure. Green hydrogen, airports, roads, data centres, water, petrochemicals, and other new areas are among them.
This investment strategy is in line with the needs of a growing economy. India’s economy will grow at an exponential rate and will be worth $25-30 trillion by 2050.
Despite the Adani shares overleveraged controversy, the three of the group’s companies have also received board approval
Among them are green hydrogen, airports, highways, data centres, water, petrochemicals, and other new fields. This investment strategy meets the needs of a growing economy. According to billionaire Gautam Adani, India’s GDP will grow dramatically and reach $25-30 trillion by 2050. Despite global issues such as climate change, geopolitics, supply chains, energy, and inflation, he continued, India is expected to grow. Adani’s portfolio currently consists of ten companies. This figure is expected to rise to 14-15 firms by 2033.
According to the company, the portfolio will still include some shares held by the promoter family. Capital recycling within this portfolio should not be interpreted as dilution, as per the Adani Group. Despite the Adani shares overleveraged controversy, Adani stocks are already on the mend. Despite the correction, the mutual fund industry remains sceptical.
