‘Adani family will take over real estate business’

Although Ahmedabad-based power, port and mining company Adani Enterprises Ltd (AEL) had decided to part with its real estate business a day ago, the Adani family is keen on retaining Adani Infrastructure Development Pvt Ltd (AIDPL). On Thursday, the board of directors of AEL had decided to divest its holdings in the company's realty business after proper independent third party valuation at its meeting.

"We may either sell it completely to a third party or go in for a joint venture or Adani Group may demerge and form a separate real estate company. We have kept all the options open as we want to categorically focus on our core businesses," executive director of Adani Enterprises and CFO of the group, Devang Desai had said while announcing the company's third quarter results on Thursday.

However, chairman of the Adani Group, Gautam Adani on Friday said that this announcement by the company "led to some confusion that the Adani Group is exiting the real estate business altogether, which is definitely not the case."

The Adani family led by Gautam Adani, the promoter of the Adani Group, is set to take over AIDPL and is committed towards a successful execution and completion of its current projects and its future growth plans, said Adani in a statement on Friday.

Presently, the Adani Group is developing Shantigram Township in Ahmedabad, spread across 616 acres of land, in which around 400 lakh square feet of land will be developed. The project cost of the township is estimated to be around Rs5,000 crore in which it intends to build up to 15,000 houses.

Shantigram Township, christened after the names of Adani's parents, is also home to the new corporate office of the group in the city.

The Adani family will continue to invest in the real estate business like it has done in realty projects in Ahmedabad, Mumbai and Delhi. The family will now be responsible for future investments in the realty business considering it as one of the key business drivers. Adani Enterprises Ltd (AEL) will focus on its capital intensive core businesses of power, ports and coal mining.

It should be noted that market players believe that if the Adani family had not taken this decision to retain its realty business, the announcement would have created a negative impression about Gujarat's real estate market.

"If a local company like the Adani Group would have quit the real estate business, it could be interpreted that the market is not in a good condition," said sources. The group may form a new company for the realty business and come up with an IPO as the group's investment in realty projects could be around Rs25,000 crore, said sources.