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After Hindenburg tragedy, Adani Group ceased working on petrochemical projects worth 34,900 crores in Mundra.

Adani Enterprises Ltd incorporated Mundra Petrochem Ltd in 2021 to establish a greenfield coal-to-PVC plant at Adani Ports and SEZ Land in Gujarat.

The sources said Adani group had suspended work on its ₹34.900 crore petrochemical project in Gujarat’s Mundra as it focuses resources on consolidating operations and addressing investor concerns.

The group’s flagship Adani Enterprises Limited (AEL) has awarded a wholly owned subsidiary, Mundra Petrochem Limited, to install a greenfield coal-to-PVC plant on the land of Adani Ports and Special Economic Zone (APSEZ). ) in the Kutch district of Gujarat by 2021.

But after a Jan. 24 report by Hindenburg Research alleging accounting fraud, stock manipulation and other corporate governance lapses slashed nearly $140 billion from Gautam Adani’s empire’s market value ( MV), the airport-apple conglomerate has made a comeback. And has calmed nervous investors Do Lenders through a return strategy.

The restructuring strategy is based on allaying investor concerns about debt by paying off part of the debt, consolidating operations and fighting charges.

The group denied all of the accusations made by Hindenburg. As part of this, projects are being reassessed based on cash flows and available financing.

Two origins with knowledge of the point said one of the projects the group has elected not to pursue for the time being is a 1mt/y green PVC project.

The group has emailed vendors and suppliers, asking them to “suspend all activities” immediately.

In the email seen by PTI, the group has asked them to suspend all scope of work activities and compliance with all obligations for Mundra Petrochem Ltd’s green PVC project “until further notice.”

This is the following “unexpected scenario.” Management said it “was reassessing several projects that were being implemented at the group level in different business verticals. Based on future cash flows and financials, some projects are being reassessed for continuation and timeline review.”

Asking for comment, a spokesman for the group said AEL would assess the status of development projects in the primary industry in the coming months.

“Each autonomous portfolio company in our group has very solid financial standing. Our business plan is fully funded, and we have excellent corporate governance, secure assets, and industry-leading project development and execution capabilities. To create value for our stakeholders, we are committed to implementing the previously described measures, “added the spokeswoman.

“AEL will assess the status of development projects in primary industry verticals in the coming months.”

The facility was designed to have a 2,000 ktpa (kilotonnes per year) polyvinyl chloride (PVC) manufacturing capability, necessitating the importation of 3.1 MTPA (million tonnes per annum) of coal from Australia, Russia, and other nations.

PVC plastic is the third most-produced synthetic polymer in the world. It has many uses, from flooring, sewage pipe fabrication and other piping applications, to electrical wire insulation, gaskets and fabrication aprons, etc.

Adani Group had planned the project as PVC demand in India of around 3.5 MTPA was growing at 7 percent year on year. With domestic PVC production almost stagnant at 1.4 million tons, India depends on imports to keep pace with demand.

The use of foreign shell firms and “blatant stock manipulation and accounting fraud” to artificially raise stock values were both alleged in the Hindenburg Report. All of Hindenburg’s charges have been denied by the organization, which has referred to them as “malicious,” “baseless,” and a “calculated attack on India.”

As part of the backtracking strategy, the group canceled the purchase of a ₹7,000 crore coal-fired plant and plans to bid for a stake in energy trader PTC to save expenses. It has repaid part of the debt obtained by promising the promoter’s participation in the group companies and has paid part of the financing in advance.


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