How has Adani group charted its success over three decades?

In one fell swoop, Indian infrastructure conglomerate Adani Group is set to become the country’s number two cement maker with the $10.5 billion acquisition of Ambuja Cements and ACC from Switzerland-based Holcim.

With 70 million tonnes per annum capacity, Adani is firmly above the number three player Shree Cement, which has a production capacity of 43 mtpa.

This would be the group’s biggest acquisition to date, highlighting its aggressive inorganic growth strategy.

The Adani group is led by 59-year-old first-generation entrepreneur Gautam Adani, who is now Asia’s richest and the world’s sixth-richest person with a fortune of nearly $106 billion, according to Forbes. 

He even briefly surpassed investment maverick Warren Buffett in the global wealth rankings recently. Dominating practically every other sector it is engaged in has been the hallmark of the Adani Group, the latest being cement.

The group was born in 1988 when Gautam Adani, who had dropped out of college,  set up the  flagship company Adani Enterprises to import and export commodities. 

Listed in 1994, Adani Enterprises became India’s biggest coal trader and the biggest coal mining contractor. It also acts as an incubator for the group’s new businesses.  

Soon after the economic liberalization, Adani won the mandate to set up Mundra Port in Gujarat in 1995.

And in 1998, Adani Ports and Special Economic Zone were set up. Mundra has become India’s largest commercial port by volume while APSEZ is India’s biggest private port operator, with 13 ports and terminals handling nearly one-fourth of the cargo movement in the country.

In 1999, Adani Wilmar was incorporated as a joint venture between the group and Singapore’s Wilmar. Known for its Fortune brand, the company went on to become the largest edible oils brand and importer in India.

With revenue of Rs 54,214 crore in FY22, Adani Wilmar trounced Hindustan Unilever as the country’s biggest FMCG company. 

The group entered the city gas distribution business in 2001. And in 2005, it won India’s first Mine Developer and Operator or MDO contract. 

Adani Ports and SEZ was listed on the exchanges in 2007. The following year, the group made its first overseas purchase by acquiring the Bunyu coal mine in Indonesia.  

In 2009, Adani Power made its debut on the bourses. It is the largest private thermal power producer in India.

In 2010, the group acquired the controversial Carmichael coal mine in Australia.  The mine has faced severe opposition from environmental groups. The first export shipment from the mine took place in December 2021.   

Adani Transmission, the largest private-sector transmission and distribution company in India, was demerged and listed in 2015. 

In 2017, the group forayed into manufacturing of solar PV panels. Adani Solar is today India's largest integrated solar cell and module manufacturer.

Adani Gas and Adani Green Energy were demerged and listed in 2018. The same year, Adani Transmission acquired Reliance Infrastructure’s Mumbai energy distribution business. 

In 2019, French energy major TotalEnergies bought a 37% stake in Adani Gas. Renamed into Adani Total Gas, the company operates the largest city gas distribution business in India. 

Adani Green Energy is among India’s biggest renewable power companies and also the group's most valuable company with a market cap of $45 billion.

In 2020, the group forayed into airports business after winning the bid to operate six Airports Authority of India airports. It also acquired the Krishnapatnam Port, which is India’s second-largest private port.

Last year, it took over Mumbai International Airport and Navi Mumbai International Airport from GVK group. This made it India's biggest private airport operator, accounting for more than a quarter of the country’s airport footfalls.

Speaking to Business Standard, Ambareesh Baliga, independent market analyst says debt has been an issue with the Adani Group. Adani Group has become large enough to be termed ‘too big to fail’ and it’s anyone’s guess as to which sector the group will enter next, he says. 

The conglomerate has been moving beyond its core business of operating ports, power plants, coal mines and renewable energy. It is now venturing into areas like data centres, financial services, airports, digital services, real estate, and media. The group’s expansion has been fuelled by debt since it bets on capital-intensive sectors. 

The seven publicly traded companies of the Adani group have a combined market capitalisation of $184 billion and that is only set to grow with the acquisition of Holcim’s India business.

But the combined gross debt of Adani group companies increased to a new high of Rs 2.09 trillion at the end of March this year, up 35.2% from Rs 1.55 trillion a year ago.