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HomeSocial IconAdani New Industries Ltd. was the recipient of TotalEnergies SE's investment

Adani New Industries Ltd. was the recipient of TotalEnergies SE’s investment

According to a Thursday Bloomberg News article, billionaire Gautam Adani may not now partner with TotalEnergies to create the green hydrogen project in India. One of the biggest foreign investors in billionaire Gautam Adani’s business empire, TotalEnergies of France, announced in February that it would postpone its involvement in the ports-to-energy conglomerate’s $50 billion hydrogen project after Hindenburg Research published a damning report on its operations.

According to a transcript on the business website, Jugeshinder Singh, the chief financial officer at Adani Enterprises Ltd., reportedly told investors last week that it is not reliant on Total’s stock to build the facility. “We are continuing the project at the same pace as it is right now.”

According to Singh, Total has made prior investments in four Adani companies, and its hydrogen-related memorandum of understanding is still in effect.

Earlier, the French energy giant had consented to pay an undisclosed fee to acquire a 25% share in Adani New Industries Ltd. in order to support green hydrogen projects in the nation.

Adani’s first green hydrogen project will be a $5 billion integrated facility with wind and solar energy production facilities as well as renewable energy generation capabilities. In June 2022, TotalEnergies had made a partnership announcement with the Adani company.

Both businesses had proposed a $50 billion capital expenditure (capex) plan to build 2.5 million metric tonnes per year (mmtpa) of green H2 manufacturing capacity over the following ten years, with the first phase’s 1.0 mmtpa capacity scheduled to be operational before 2030. Despite the fact that TotalEnergies didn’t sign a contract.

According to Singh, Adani Enterprises will invest roughly $300 million in the hydrogen industry in the year through March, and from the next year, this investment will start to rise quickly. According to Singh, the company expects to invest $3.7 billion in capital during the year.

In response to claims of accounting and financial fraud made by Hindenburg Research, TotalEnergies, a company with a $3.1 billion exposure to the Adani Group, stated in February that it would wait to see the results of an audit that had been commissioned by the conglomerate.

ANIL was expected to contribute its understanding of the Indian market, execution skills, operational excellence, and capital management philosophy to the partnership announced in June 2022, while TotalEnergies was expected to contribute its knowledge of the global market, credit enhancement, financial strength to reduce financing costs, and expertise in underlying technologies.

At its Khavda and Mundra SEZ facilities, ANIL intended to produce green hydrogen as well as its byproducts like ammonia, urea, methanol, and ethanol. Due to its abundant wind and solar resource potential, the 71,000-acre Khavda site offers a 20 GW large-scale renewable deployment potential.

At Khavda, the company intends to create 2.5 million tonnes of green H2 annually (by FY31) using the alkaline and PEM electrolysis technique.

Adani Enterprises announced a consolidated net profit of Rs 674 crore on August 3 for the quarter that ended in June 2023, up 44% from the Rs 469 crore reported in the previous fiscal.

According to a filing with the stock exchange, the company’s operating revenue was Rs 25,438 crore, down 38% from the Rs 40,844 crore reported during the prior similar quarter. The decline was attributed by Adani Enterprises to a decline in coal prices.

The increase in net profit was aided by a jump in other income, which increased to Rs 371.5 crore in Q1 from Rs 222 crore in Q1 of last year.

The company reported that “on account of strong operational growth,” its Earnings before interest, taxes, depreciation, and amortization (EBITDA) climbed by 47% YoY to Rs 2,896 crore.

This is the second investment by the fund in the company made by Qatar Investment Authority, which earlier this week purchased a 25% interest in Adani Electricity Mumbai in 2020.

In order to pay off share-backed funding, promoter entities of the Adani group have been selling large chunks of shares in group firms. GQG Partners had acquired stakes before. Adani said in March that share-backed loans with a margin component had been repaid in excess of $2 billion.

Adani Green’s board authorized a qualified institutional placement to raise Rs 12,300 crore in July.