The Adani group is committed to completing key infrastructure projects in Mumbai, founder and chairman of the group, Gautam Adani said on Tuesday (18 July) while addressing shareholders at Adani Enterprises’ annual general meeting.
In the financial capital Mumbai, Gautam Adani is sitting on three key projects, including the Dharavi Redevelopment Project (DRP); the Navi Mumbai International Airport, and the power distribution business.
Questions have been raised about the future of these multi-billion projects helmed by the Adani group, ever since Hindenburg Research accused the port-to-power conglomerate of stock manipulation and accounting fraud in a 24 January report.
Navi Mumbai International Airport
The Navi Mumbai International Airport (NMIA) is on track to open for air traffic by December 2024, said Gautam Adani during his AGM speech.
NMIA, which will be the second airport in Mumbai Metropolitan Region (MMR), will address the capacity constraints at Chhatrapati Shivaji Maharaj International Airport.
The new airport would shake up the demand-supply dynamics by adding 40 per cent more passenger handling capacity overnight to the MMR region.
The project is being implemented by Navi Mumbai International Airport Limited (NMIAL), which is a special purpose vehicle (SPV) with equity participation of Adani Airport Holdings Limited (AAHL), a wholly-owned subsidiary of Adani Enterprises Limited and CIDCO (City and Industrial Development Corporation), in 74:26 ratio.
The project scope includes development of an international airport (in phases) with a capacity to handle minimum 60 million passengers per annum (MPPA) and 1.5 million tonnes cargo per annum. In the initial phase, capacity of 20 million passengers per annum and 800,000 tons per annum of cargo handling capacity is being planned.
Power Distribution
In his speech to the shareholders, Gautam Adani said that Adani Transmission would transform Mumbai into the first mega city in the world to achieve over 50 per cent — at 60 per cent — power from renewable sources like solar and wind.
Adani Transmission Ltd (ATL) is India’s largest private power distribution company and the transmission arm of the diversified Adani Group. ATL is responsible for bulk power procurement for distribution in Mumbai region by its B2C, or business-to-consumer arm, Adani Electricity Mumbai Limited (AEML).
“I am also very pleased to state that ATL’s Mumbai distribution business achieved reliability of 99.99 per cent and was ranked the No.1 discom by the Union Ministry of Power,” he added.
The Adani group entered power distribution in Mumbai suburbs four years ago with the Rs 18,000-crore acquisition of the beleaguered Anil Ambani Group-run Reliance Energy and competes with Tata Power in the business.
Dharavi Redevelopment
Dharavi, which is located on the northernmost tip of Mumbai’s island city, is one of the biggest slums on the planet — and a key backdrop for the popular film Slumdog Millionaire.
The Dharavi revamp that seeks to transform Asia’s second-largest slum cluster will be a key challenge for the beleaguered group.
Earlier on 13 July, the Maharashtra Housing Department had granted final approval for the appointment of Adani Properties for the redevelopment of Dharavi.
The approval comes eight months since Adani Realty, the real estate arm of the ports-to-power conglomerate, was declared the highest bidder for the ambitious redevelopment project.
In November 2022, the Adani group had emerged as the highest bidder for the redevelopment project with an initial investment commitment of Rs 5,069 crore, against a base price of Rs 1,600 crore.
Adani Realty will get seven years to see the work through, including rehabilitating more than 56,000 families. The project is estimated to cost around Rs 23,000 crore.
The scope of the redevelopment will span 2.8 sq km and about 68,000 slum dwellers and those running commercial enterprises will be resettled.
According to the terms of the tender, the proposed completion period for construction of the rehabilitation facilities, renewal, amenities and infrastructure is seven years from the date of the commencement certificate for the first phase of the project.
While the group’s plans for Navi Mumbai airport and power distribution does not have much trouble going forward, Adani’s ability to complete the Dharavi project is under scanner. If successful, Adani would gain a major foothold in India’s financial capital, where he already runs one of the country’s busiest airports.
