Adani Flagship’s Profit Jumps 115% on Airports, Mining Units

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(Bloomberg) — Adani Enterprises Ltd. posted a 115% jump in quarterly profit, boosted by some of its newer businesses as billionaire Gautam Adani’s flagship rebounds from a scathing short seller attack last year. 

The Ahmedabad-based firm posted net income of 14.5 billion rupees ($173 million) for the first fiscal quarter through June 30, compared with 6.74 billion rupees a year ago, according to an exchange filing Thursday. 

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There weren’t enough brokerages tracking the firm to derive an average profit forecast. Shares closed 1.5% higher in Mumbai after the earnings were announced.

Revenue rose 12.5% to 254.7 billion rupees, while total costs climbed 8.6% to 238.3 billion rupees. Adani Enterprises, which oversees a motley mix of businesses from coal trading to airports to data centers and green hydrogen, announced hiving off its consumer goods division.

The revenue from airports business jumped almost 30% to 21.5 billion rupees while its so-called “new energy ecosystem” more than doubled to 44.6 billion rupees, the company said in the filing.

Sales from mining operations were up 45.4% to 8.6 billion rupees but the revenue from its Integrated Resource Management unit, which mostly consists of coal trading, slipped 28% to 107.9 billion rupees. Its earnings before interest, taxes, depreciation, and amortization rose 48% to 43 billion rupees while gross debt climbed 13% to 566.6 billion rupees.

The robust earnings by the holding company that incubates all the group’s new businesses adds to the tailwinds for the ports-to-power conglomerate that is chalking out ambitious growth plans, including a $100 billion investment in green energy, and feels emboldened enough to tap equity markets again.

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Regaining Ground

Adani’s empire battled a withering short seller attack in early 2023 but has been rapidly regaining lost ground this year. Hindenburg Research’s allegations of wide-ranging corporate fraud in January 2023, which despite denials from the Adani Group had triggered a stock rout and pushed the conglomerate into months of damage control.

The flagship’s board approved demerger of the food business to Adani Wilmar Ltd., along with Adani Enterprises’s “strategic investment in Adani Commodities LLP,” according to a company statement. 

The food business “has become self-sustained, performing well and poised for further growth under” Adani Wilmar, it said. “This arrangement will not only unlock the value for shareholders but also allow focused strategy for sustainable growth in its incubating businesses.”

Adani Enterprises is planning to launch a share sale this month or the next, IFR reported earlier on Thursday, citing people familiar with the matter. It also plans to revive its first-ever public sale of bonds by raising as much as 6 billion rupees, Bloomberg News reported this week, in signs of continuing recovery.

—With assistance from Karen Leigh.

(Updates with details throughout. A previous version of the story corrected the revenue surge in the second paragraph.)

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