Full-page ads scream ‘Global’, ‘India’ and ‘Adani’, waking up the morning reader to a brand new group. The Rs 33,000-crore, Ahmedabad-based Adani conglomerate is in the throes of a makeover aimed at transforming it into an Indian multinational that has operations across the globe.
Its refurbished identity boasts of three colours - green, blue and orange - representing its three main businesses — resources, logistics and energy — that morph into the colour purple, the group shade.
While the Adanis have employed the services of Omnicom-controlled brand consultancy Wolff Olins to recast its identity, the question is: can the makeover help change the image of the group battling tax authorities, environmentalists and the government?
The verdict appears to be still out on that one. But some experts believe that the image overhaul should have actually followed a re-engineering exercise within the group. “A makeover without credible action is merely cosmetic,” says Nabankur Gupta, former group-president of Raymond Ltd, who is now founder CEO, Nobby Brand Architects. “The logo change should have followed an internal restructuring first. That would have driven home the point better that the group is indeed looking to make a new start.”
Persons familiar with developments at the Adani group, however, say that the latter opted to kickstart its branding exercise first, using it as a pivot to mount a larger business reorganisation. The next step will see the group, which has just bagged the Rs 1,000-crore Kandla bulk terminal project, undertake a brand valuation exercise. Helping them here will be the UK-based BrandFinance, which has done work for a number of bluechip Indian companies including the Godrej group, the Tatas and Reliance-ADAG.
Unni Krishnan, managing director, BrandFinance, says that the brand valuation exercise will help the Adanis derive business synergies from their various units. “It could help them unlock value in the future,” he says.
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Gautam Adani, chairman, Adani Group, indicates as much when he says, “We are expanding expeditiously in different areas in different parts of the world. The focus will be on core areas, while the emphasis on non-core areas will be reduced.”
Non-core here are areas such as real estate, while core is infrastructure, its three legs being - ports (logistics), power generation (energy) and coal mining (resources).
Adani says, “If you look at our history, we started off as traders (of salt). By 1998-99, we had stepped into the development of ports. By the next decade, that is 2007, we had entered into power generation and coal mining.”
In the process, the Adanis have grown in size at the cost of credibility. While Adani Ports and SEZ controls the fourth largest port in India, which is Mundra, not all its other ports (it has facilities in Dahej and Marmagao) are running smoothly. The company has been denied security clearance to bid for a number of port projects across the country thereby styming its plan of being a pan-India ports player. Some of the projects where it has not been allowed to participate include a fertiliser loading berth and an iron-ore loading facility at Visakhapatnam, a container terminal project at Jawaharlal Nehru Port Trust (JNPT), Mumbai, and Vizhinjam port in Kerala.
“Yes, we have these issues with the government. We are pursuing them both legally and also at the executive level. But to say that all our plans have been shot down is an exaggeration,” says Ameet Desai, managing director, Adani Enterprises.
In power, with the synchronisation of an additional 660-megawatt-unit at its plant in Mundra, Adani has become the largest private-sector power generator, with a capacity of around 4,000 megawatts. It also has a long-term plan of increasing its generation capacity by five times to 20,000 megawatts by 2020.
But like much of its other projects, these plans too have run into rough weather. One of them being fuel supply blocks in Maharashtra and Gujarat.
“Adani Power much like other power companies is facing issues such as go and no-go areas and non-availability of fuel supply,” says Adani. A change in law in coal-rich Indonesia is also hurting Adani following which fuel imports have become expensive. This is important as the group is setting up 4,620-megawatt power capacity at Mundra based on imported coal from Indonesia.
Despite the bottlenecks, Adani appears unperturbed. The reticent businessman took to the podium on Thursday addressing his employees, both national and international (via a videolink), on his group’s future plans. At least his internal stakeholders (read employees) should be a happy lot.