MUMBAI: Despite having several projects under implementation and conception stage within the country as well as overseas, Adani Ports and Special Economic Zone Ltd (APSEZL), the largest commercial port operator in India, doesn’t seem to be daunted by any liquidity challenges in the near-term.
At a consolidated level, APSEZL’s liquidity position is expected to remain adequate with cash and liquid investments of about Rs9,817 crore as on March 31, 2024.
As per ICRA’s estimates, the cash flow from operations will remain in the range of about Rs11,000 crore to about Rs14,000 crore in FY2025 and FY2026, against a far less repayment obligations of Rs7,600-Rs7,800 crore in FY2025 and Rs6,100-Rs6,200 crore in FY2026.
No liquidity challenges
The long-term debt and capex plans (including acquisitions) are estimated at about Rs14,000 crore in FY2025 and Rs11,500-12,500 crore over FY2026 and FY2027.
“The liquidity profile is also supported by APSEZL’s un-utilised working capital limits. Further, the viability gap fund (VGF) for the Vizhinjam project will support the liquidity profile,” ICRA noted.
After a damning report by the US short seller Hindenburg that impacted the market value of its listed companies, the Adani Group in 2023-24 focused on managing debt, reducing founder share pledges, and consolidating its business around core competencies.
627MMT annual capacity
APSEZL is the largest port developer and operator in India by volume with an annual capacity of about 627 MMT and operating 15 ports across India.
It commenced operations with the Mundra Port in Gujarat under a 30-year concession agreement with Gujarat Maritime Board (GMB).
Since then, the port company has rapidly grown to become the largest in the country in terms of cargo handling capacity with ports/terminals at Mundra, Dahej, Hazira, Dhamra, Kattupalli, Krishnapatnam, Mormugao, Tuna, Dighi, Gangavaram, Ennore, etc
27% market share
At present, APSEZL handles almost 27 per cent of the total cargo volumes at the Indian ports and the volume growth is expected to remain healthy going forward, supported by the strong operational performance of the company’s port assets.
Foray into overseas projects
The company’s foray into projects in Sri Lanka, Haifa in Israel and Dar es Salaam port in Tanzania will also provide geographic diversification for APSEZL.
APSEZL is co-developing a new terminal at Colombo, Sri Lanka, which will be executed over the next three years at a total estimated project cost of about $800 million.
The same will be partly debt-funded and entails APSEZL’s equity contribution in the special purpose vehicle (SPV).
