New Delhi: The Adani group has suspended work on a Rs. 34,900 crore petrochemical project in Mundra, Gujarat as concerns over its finances continue.
This decision comes two months after US-based short-seller Hindenburg Research published a report accusing the Adani group of large-scale accounting fraud and stock manipulation, leading to serious concerns and a free fall in Adani group companies’ share prices. The Gautam Adani-led conglomerate has denied these allegations.
According to reports of Financial Express, Adani Enterprises Ltd had incorporated a wholly-owned subsidiary, Mundra Petrochem Ltd, to set up a greenfield coal-to-PVC plant at Adani Ports and Special Economic Zone land in Kutch district in 2021. The group has sent emails to vendors and suppliers, telling them to “suspend all activities” on an immediate basis “till further notice”.
The unit was to have a poly-vinyl-chloride (PVC) production capacity of 2,000 kilo tonne per annum requiring 3.1 million tonne per annum of coal that was to be imported from Australia, Russia and other countries. PVC demand in India has been rising.
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”.