Adani Group Eyes $4 Billion Funding For Low-Cost Green Hydrogen Manufacturing: Report

The Adani Group, led by billionaire Gautam Adani, is reportedly planning to raise up to $4 billion to support the setting up of manufacturing facilities for low-cost green hydrogen.

Adani New Industries Ltd., a subsidiary of Adani Enterprises Ltd., is in the initial stages of discussions with multiple domestic and international banks to raise funds, Economic Times reported citing people familiar with the matter.

In June, France's TotalEnergies SE and Adani announced their intention to invest $5 billion in India to produce green hydrogen and related products.

This investment comes as India, the world's third-largest polluting nation, aims to decarbonise.

Gautam Adani, the head of Adani Group, has earlier stated that 75 per cent of the group's projected capital expenditure will be allocated to green businesses.

Additionally, his companies plan to invest $20 billion over the next ten years in renewables, green component manufacturing, and associated infrastructure.

Adani and his rival Mukesh Ambani, who is chairman of the Reliance Industries, are placing their bets on green hydrogen as Prime Minister Narendra Modi aims to position India as a leader in the shift towards cleaner technology.

“It is not too difficult to imagine a scenario where green hydrogen at a price of less than $1/kg — coupled with the projected reduction in the cost of combined cycle hydrogen turbines and fuel cells — will not only allow the country to make a transition from fossil fuels, but also free India from the debilitating financial burden of energy imports," the website states.

Adani New Industries plans to raise new capital separately from Total, according to the people cited in the ET report.

The funds will be allocated to various projects, including a green hydrogen facility in Gujarat with a production capacity of 1 million metric tons per year. It is expected that the plant will commence operations in 2027.

A successful project finance close would indicate that the ports-to-power conglomerate is regaining the trust of lenders, following allegations of corporate fraud made by Hindenburg Research in January.

Despite vehemently denying the accusations, Adani Group's bonds and shares experienced a significant decline and have yet to fully recover.

Currently, India's market regulator is conducting a court-mandated investigation to determine if the conglomerate violated any local securities laws.