After Total SA, More Foreign Investors Seeking Adani Partnership: Gautam Adani

After Total SA, more foreign investors have shown interest in partnering Adani group in its renewable energy business, chairman Gautam Adani has said

After French energy major Total SA, more foreign investors have shown interest in partnering Adani group in its renewable energy business, chairman Gautam Adani said recently.

In April, Total had invested around Rs 3,707 crore for 50 percent partnership with Adani Green Energy for a joint venture that will house 2.148 gigawatts (GW) of operating solar power projects across 11 states in India.

“We have headroom for diluting 10-15 percent stake in Adani Green Energy,” he said on a call to announce Adani Green Energy winning the world’s largest solar tender to build 8 GW of photovoltaic (PV) power generating capacity along with a domestic solar panel manufacturing unit at an investment of Rs 45,000 crore.

Total, he said, is “very much interested” in expanding partnership with Adani. Promoters hold 75 percent of Adani Green Energy and can further dilute 10-15 percent, he said. Foreign investors are interested in investing in renewable energy in India with local partners, he said. “A couple of more partners are also talking to us (for Adani Green Energy),” he said without giving details.

Adani Green, which is the clean energy arm of the conglomerate, aims to scale up capacity to 25 GW by 2025. With the latest contract, its portfolio has grown to 15 GW and the firm hopes to win contracts for another 10 GW this year, he said.

The group has committed to invest over 70 percent of its budgeted capex into clean energy and energy-efficient systems so as to become the largest solar player in the world by 2025 and the largest renewable player in the world by 2030.

Adani said the Rs 45,000 crore or USD 6 billion investment in the 8 GW solar projects and 2 GW of solar panel manufacturing units will be funded through a combination of debt and equity. He expressed confidence in procuring debt for the project over the next five years.

“Adani Green Energy is the only renewable company outside of OECD countries which enjoys credit rating equal to the sovereign,” he said adding the company was well-equipped to fund the projects.

With its existing facilities in Gujarat, Adani Green is expected to set up further manufacturing there only, while the generation PV plants will be spread out over more states, notably Rajasthan.

These manufacturing linked projects had been floated in November 2019, with Adani Green and Azure emerging as winners in January. With effectively a guaranteed off-take for the first 3-4 years for the manufacturing that is set up, at a higher tariff ceiling price of Rs 2.93 kWh, the idea was to provide manufacturing investments with enough comfort for a ready demand and pricing in the initial phase.