Billionaire Adani says India will add US$1t to GDP every 12 to 18 months
ASIA’S richest man, Gautam Adani, said that credit metrics at his businesses were improving and a deeper understanding of his rapidly expanding conglomerate would allay any concerns around its borrowings.
“Greatly surprised by the conversations about our debt,” he told news channel India Today on Wednesday (Dec 28) during an interview. “In the past nine years, our profit has been growing at twice the rate of our debt.”
Asserting that the ports-to-power conglomerate was “financially very strong and secure”, the Indian billionaire said that the strong profit trajectory had helped pare the debt-to-Ebitda (earnings before interest, taxes, depreciation and amortisation) ratio to 3.2 from 7.6 in the same period. That “is very healthy for a large group where most of the companies are in the infrastructure space”.
The first-generation entrepreneur – who is also the world’s biggest wealth-gainer in 2022 – has been on a breakneck expansion spree, acquiring and seeding new businesses. Adani is rapidly diversifying his empire beyond ports and coal-based businesses into green energy, airports, cement, media, data centres and metals.
A lot of this growth has been debt-fuelled, which has been red-flagged by some credit watchers.
The tycoon also said that his companies now have a broader lender mix. The share of loans from Indian banks has reduced from 86 per cent to 32 per cent in the overall debt portfolio in the past nine years.
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“Almost 50 per cent of our borrowing is through international bonds,” he said.
Adani, who has often dovetailed his corporate strategy with nation-building priorities, was also very bullish about India’s prospects. “This century belongs to India,” he said, elaborating that the country will add a trillion dollars to its GDP every 12 to 18 months within the next decade, given its large middle-class and young population. BLOOMBERG
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