India’s Adani Group suspends work on 2m tonne/year PVC project – reports

MUMBAI (ICIS)–India’s Adani Group is suspending work on its Indian rupee (Rs) 349bn ($4.2bn) polyvinyl chloride (PVC) project in Mundra in the western Gujarat state, according to media reports.

Company representative refused to comment when contacted by ICIS news.

The group has asked its vendors and suppliers to suspend all activities and performance of all obligations for the 2m tonne/year PVC project until further notice, according to media reports.

Adani Enterprises Ltd (AEL), the flagship company of this group, was supposed to execute the coal-to-PVC project.

The proposed project was expected to produce PVC grades such as suspension PVC (resin), chlorinated PVC (C-PVC) and emulsion PVC (paste), AEL had said.

The company planned to bring the project on stream within four years of receiving all the necessary approvals, with a target to commission the project by 2025-2026.

Adani Group chief financial officer Jugeshinder Singh had announced in a post-earnings call on 15 February that the group would review its plans to build the PVC plant at Mundra.

The conglomerate lost more than $145bn in market capitalisation in a month after US-based investment firm Hindenburg Research released a report on 24 January accusing the conglomerate of stock manipulation and improper use of tax havens.

Adani Group is an Indian multinational conglomerate. Its subsidiaries which are listed on the Bombay Stock Exchange (BSE).

Hindenburg Research also wrote about Adani Group’s mounting debt, an area of concern for investors.

Due to the impact the report, the group has started to reduce debt aggressively to regain the confidence of market participants.

The group had announced on 15 February that it planned to moderate certain accelerations budgeted in its earlier capital expenditure (capex) plans but would continue with the investment plans for its core infrastructure businesses.

“The management is re-evaluating various project/s being implemented at group level in different business verticals. Based on future cashflow and finance, some of the project/s are being re-evaluated for its continuation and revision in timeline,” Indian newswire Press Trust of India (PTI) reported quoting a company representative.

($1= Rs82.67)