Gautam Adani is expanding his business and investing in different sectors. He has planned to spend more than Rs 33 thousand crores in the next 28 months, where he will feed a sector which has a huge difference in demand and supply. Yes, Adani Group will enter the petrochemical sector by starting the first phase of the four billion US dollar polyvinyl chloride (PVC) project by December 2026. Sources said that this is a sector in which there is a huge difference in domestic demand and supply.
How much is the demand in India
Polyvinyl chloride (PVC) – the third most common synthetic plastic polymer made worldwide. It is used to make products such as raincoats, shower curtains, window frames, pipes for indoor plumbing, medical equipment, wire and cable insulation, bottles, credit cards and flooring. India’s annual PVC demand is about 40 lakh tonnes but the domestic production capacity is only 15 lakh tonnes. Because of this, there is a huge gap between demand and supply. This gap will increase further as consumption increases. Adani Group wants to take advantage by entering this sector.
Plant will be built here
Adani Enterprises, the flagship company of the group, is setting up a petrochemical cluster in Mundra, Gujarat. Two sources familiar with the matter said that the company intends to set up a PVC plant with an annual capacity of 20 lakh tonnes inside this cluster. This plant will be set up in several phases. He said that its initial phase is expected to be operational by December 2026. During this time, the production capacity of the plant will be 10 lakh tonnes per annum.
The project had to be stopped
The group had stopped the project in March last year. The group had said that it has decided to stop major equipment purchases and site construction activities until financial resources are raised. After this, American short seller Hindenburg Research had accused Adani Group companies of financial and accounting fraud in a report. However, Adani Group had rejected all the allegations but after this report came out, the shares of the group companies fell sharply.
SBI consortium is financing
After this, the group made a strategy for comeback. Under this, it raised five billion dollars in the form of equity and twice the amount in the form of debt. It also paid off some of its debt. After the market’s confidence was restored, the Adani Group resumed work on the petrochemical plant. Sources said that a consortium of lenders led by State Bank of India (SBI) is financing this project.