India’s one of the fastest-growing conglomerates the Adani Group is taking another move to expand its foothold in India’s eastern coastline, Adani Ports and Special Economic Zone (APSEZ) announced plans to acquire a majority stake in Odisha’s Gopalpur Port.
Also Read | Inflation Rate Stands at 5.09%, Remains within RBI Tolerance Range for the sixth consecutive month
Stake in Gopalpur Port
Adani Ports said that it is planning to procure a stake of around 95% of Gopalpur Port thereby paving the way for a significant move to expand its position along the eastern coast. The company seeks equity value at INR 1,349 Cr to rub shoulders with the enterprise value of INR 3080 Cr, which would enable it to boost its regional influence.
Strategic Acquisition Approach
The acquisition involves acquiring a 56% stake from the renowned Shapoorji Pallonji Group (SP Group) and an additional 39% from Orissa Stevedores Ltd (OSL). Pending statutory approvals and fulfilment of other prerequisites, the transaction is set to enhance Adani Ports’ integrated logistics network.
Acquisition of Strategic Importance
Karan Adani, the Managing Director of Adani Ports, focused on the strategic importance of this acquisition, and he highlighted its potential in enabling the development of a shared port base for the Adani Group, consequently bringing the volume of cargo transported between India’s East and West Coasts into balance. Adani pointed out that the matter-of-fact combination of Gopalpur Port within APSEZ’s operational flow was seen as one of the port’s biggest attractions.
Gopalpur Port: A Strategic Asset
Gopalpur Port, operational since 2015, plays a pivotal role in servicing the steel industry. Situated strategically along the Bay of Bengal, its connectivity to key transportation arteries and exemption from regulatory pricing constraints positions it as a vital cog in India’s cargo handling ecosystem.
Also Read | SEBI Proposes Easing Investment Restrictions For Index Funds And ETFs
Market Insights and Outlook
In October 2023, reports of the company’s acquisition of multi-purpose facilities along the eastern coast emerged, which is a good indication of Adani Ports’ strategic plan to expand its business. The company’s robust performance, evidenced by a surge in cargo volumes, coupled with positive brokerage outlooks, underscores investor confidence in its growth trajectory.
With a steadfast commitment to growth, Adani Ports remains poised to achieve its volume targets for FY24 and FY25, aiming for 390-400 MT and 500 MT, respectively.
