Industrialist Gautam Adani
Gautam Adani is expanding his business and investing in different sectors. He plans to spend over Rs 33,000 crore in the next 28 months, where he will feed a sector that has a huge gap between supply and demand. Yes, Adani Group will enter the petrochemical sector by starting the first phase of the USD 4 billion polyvinyl chloride (PVC) project by December 2026. Sources said that this is a sector where there is a huge gap between domestic supply and demand.
What is the demand in India?
Polyvinyl chloride (PVC) – The third most common synthetic plastic polymer produced worldwide. It is used to make products such as raincoats, shower curtains, window frames, indoor plumbing pipes, medical equipment, wire and cable insulation, bottles, credit cards and flooring. India’s annual demand for PVC is about 40 lakh tonnes, but the domestic production capacity is only 15 lakh tonnes. Due to this, there is a huge gap between supply and demand. This gap will widen as consumption increases. Adani Group wants to take advantage of the entry into this space.
The plant will be built here.
The group’s flagship company, Adani Enterprises, is setting up a petrochemical cluster in Mundra, Gujarat. Two sources with knowledge of the matter said that the company intends to set up a PVC plant with a capacity of 2 million tonnes per annum in this cluster. This plant will be set up in several phases. It said that its initial phase is expected to be operational by December 2026. During this period, the production capacity of the plant will be 10 lakh tonnes per annum.
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The project had to be stopped.
The group had stopped this project in March last year. The group had said that it had decided to suspend the procurement of major equipment and construction activities of the site until financial resources were mobilized. Following this, American short-seller Hindenburg Research accused the Adani Group companies of financial and accounting fraud in a report. Though Adani Group had rejected all the allegations, after this report came, there was a huge fall in the shares of the group companies.
The SBI consortium is financing
Following this, the group made a comeback strategy. In this framework, it raised five billion dollars in the form of equity and twice as much in the form of debt. It also repaid some of its debts. After market confidence was restored, the Adani Group resumed work on the petrochemical plant. Sources said that a consortium of lenders led by the State Bank of India (SBI) is financing this project.
