Adani Enterprises Ltd

NSE:ADANIENT

Q1-2026 Earnings Call

[Operator]

Ladies and gentlemen, good day, and welcome to the Adani Enterprises Q1 FY '26 Earnings Conference Call hosted by Investec Capital Services India Private Limited. [Operator Instructions] Please note that this call is being recorded.

With this, I now hand the conference over to Mr. Aditya Bhartia, Head of Research at Investec. Thank you, and over to you, sir.

[Aditya Bhartia, analyst]

Thank you, Sanya. Good evening, everyone. A warm welcome on behalf of Investec India to Q1 FY '26 Earnings Call of Adani Enterprises. We have with us the senior management team represented by Mr. Robbie Singh, Group CFO; Mr. Manan Vakharia and Mr. Jitendra [indiscernible], Investor Relations.

Now I hand over the call to the management for initial comments, post which we will open the floor for Q&A. Thank you, and over to you, sir.

[Jugeshinder Singh, executive]

Thank you, Aditya. This is Robbie here. Good evening, everyone. Thank you for joining us today for Adani Enterprise results for the quarter ended June 30, 2025. AEL's portfolio is categorized into incubating and established businesses, spanning energy and utilities, transport, logistics, consumer services and primary industries.

The key incubating businesses include Adani New Industries, airports, roads and data center. The established businesses consist of primary industry vertical, which includes mining services, metals and materials and commercial mining.

Just as a broad outline, this quarter's results were affected by global trade uncertainties, although we expect that to normalize during the rest of the year.

Furthermore, these results of this quarter reflect a significant stabilization phase of our incubating businesses, and we will see the operationalization of 3 large assets over the next 2 to 3 quarters. We'll discuss them in detail in FAQ. We will see EBITDA unlocking from assets like Navi Mumbai Airport, Kutch Copper and Ganga Expressway as we move forward in FY '25-'26.

The consolidated results are as follows: total income, INR 22,437 crores; EBITDA, INR 3,786 crores; PBT, INR 1,466 crores. Incubating EBITDA increased by 5% to INR 2,800 crores. ANIL's EBITDA is at INR 1,212 crore, and the solar business maintained a volume of over 1 gigawatt per quarter and was at 1,350 megawatts. It also got first external order of 300 megawatts for the newly listed 3.3-megawatt wind turbine.

Airport EBITDA grew 61% to INR 1,094 crore with now the run rate EBITDA being comfortably above INR 1,000 crore per quarter. There were 23.4 million passenger movements at the airport for this quarter. Additionally, MIAL, a subsidiary of AAHL, received its tariff order, which is effective from 16th May 2025.

The greenfield Ganga Expressway project in our Roads business is now 85% complete and is set to be completed in the second half of this year. I'm also pleased to report the change in ESG. Sustainalytics now rates AEL at 28 from previous score of 34 and moving it from high risk to a medium-risk business.

Just a quick snapshot of the mining services portfolio. The dispatch volume in our MDO business increased by 30% to 12.1 million metric tonnes, with the revenue rising in line at 35% to INR 1,159 crores and EBITDA is now at INR 484 crores.

In the integrated resource management, which was affected by this quarter's trade-related uncertainties, the revenue stood at INR 8,000 crores and EBITDA at INR 605 crores. Carmichael mine continued to ship at or around its rated capacity, and this quarter shipped 2.3 million metric tonnes.

We can now open for Q&A.

[Operator]

[Operator Instructions] The first question comes from the line of Mohit Kumar from ICICI Securities.

[Mohit Kumar, analyst]

My first question is, did you mention the value unlocking or earnings to grow from new businesses like data center, Mumbai Airport and copper businesses?

[Jugeshinder Singh, executive]

See if I understand the question correct, is the earnings growth from the new businesses. So the -- see, currently, the major assets in airport that is operating is Mumbai Airport. And all of the rest of the airports are in various stages of their brownfield expansion, be it Ahmedabad, be it Jaipur, be it Guwahati, be it Lucknow and Navi Mumbai is under development. So we expect that Navi Mumbai will have operational clearances somewhere around October this year to be precise, and it will ramp up then within the next 6 months to its capacity. In fact, we are confident of the ramp-up to be on schedule, and it's very likely that the second terminal development there will also commence shortly thereafter. So that's on the Navi Mumbai asset.

Ganga Expressway, we expect to have completion around the last quarter of this year. And therefore, from a numbers perspective, we expect to see the impact, not in this financial year, but in the next financial year because in this financial year, Ganga Expressway will be operating maybe around 60 to 100 days only.

Kutch Copper, we expect that to start showing up in the relevant numbers, and we will report accordingly probably towards the end of this year and first quarter next year in a meaningful way. The other major asset that is under construction is the PVC project, but that's still in its first years of major construction. So we expect that the construction period -- it's on schedule, so we expect construction period to be another couple of years.

[Mohit Kumar, analyst]

Understood, sir. And are we looking to some kind of value unlocking from all the new assets in near term? Or do you think basically it will be happen in the longer term? And sir, value unlocking because...

[Jugeshinder Singh, executive]

No, value unlocking meaning as we have already indicated, we are comfortable that at least the airport business will be technically ready, subject to Board approvals to -- it will be meeting its criteria by 2027. So of the way we do it as a demerger either to -- it will just be -- the shares will be handed over to the AEL shareholders. But aside from that, the other major businesses, we are not -- we have not yet indicated or we have not yet outlined the time line. So outside of the airports, which we think is in the near term in the next 18 months, 2 years, other businesses will be obviously post that.

[Mohit Kumar, analyst]

Understood, sir. My second question is on the solar business, given that the tariff has been imposed in the U.S., the talk of increase the tariff materially. How do you think the mix is going to change for us for solar? Are you looking at more domestic sales? And related question is that we have 2 gigawatts solar ingot, right, and that's operational. Are we not thinking of increasing that 2 gigawatt to 10 gigawatt capacity, especially ingot and wafer?

[Jugeshinder Singh, executive]

See, there, it's a sequence. The first is that to take the cell and module line to 10 gigawatt and then correspondingly continue to increase the associated chain like ingot, wafers and other associated infrastructure. But our first key focus is to take the cell and module line to 10 gigawatt.

And in relation to your first question, while we are going through -- we've seen this trade disruption events, et cetera, over the last quarter, we don't see -- whilst the mix can alter, but I think it's too early to comment on these things. We will see how it spans out over the next 12 months or so to update the market in relation to the precise impact of the tariff structures. But overall, this uncertainty will have some impact on the business. But correspondingly, the opportunity for us from our own point of view will also continue to increase. So we don't see as -- in the longer-term perspective, we don't see an impact on ANIL of these tariffs. Our business plan does not significantly -- is not dependent upon in any significant way on the EBITDA of the manufacturing component of ANIL. It is finally a green hydrogen business. And consequently, that is a bigger aim for us.

[Operator]

The next question comes from the line of Veenit from Investec.

[Veenit Pasad, analyst]

My first question is on Kutch Copper. Now that Kutch Copper will get operational by end of this year. And some time back, we had also incorporated a subsidiary there to foray into cables manufacturing. So can you highlight some time lines, what our plans towards cables manufacturing, what CapEx that will involve and by when that will get operational?

[Jugeshinder Singh, executive]

I think just to clarify one point there. First is that those downstream businesses are joint ventures rather than pure subsidiaries with the relevant expertise. And our first clear objective here is that we -- in a process industry, the main objective is to streamline the process element and therefore, run at full production. So that's number one.

So once that is achieved, then our second objective in this is the tubes business. And from there on will be the other JV. And they are a little bit away in terms of -- in any meaningful contribution because there more would be a JV -- the main objective here is to ramp up, get the process machinery in play and ramp up the capacity when we are ready to for the Kutch Copper plant.

[Veenit Pasad, analyst]

Understood. Understood. Sir, my second question is on Navi Mumbai. And you sounded fairly confident around the scaling up of the Navi Mumbai Airport and second phase getting into construction fairly soon after the first one commences. Sir, it would be great if you can throw some light on how the utilization levels will ramp up? How long could it take for us to reach optimum utilization levels there in the first phase? And have we -- what proportion of, let's say, slots have been taken up by airlines? Or some color on that would be helpful.

[Jugeshinder Singh, executive]

Yes, I think it's an excellent question. As I think I said last -- in the last presentation in post the annual results, we are in the process of working out the relevant internal disclosures, et cetera, to actually have the airport team join the next call post half yearly results because I think it is their show and they should have the opportunity to answer the questions you have via their presentation. All of those will be answered. And we think it's a better time to do that from a disclosure reform certainty perspective and giving full view to the market would be post the half yearly results.

And the airport team will present that, answer that. I think it's not appropriate at this stage to go through that level of detail because we are ourselves just going through the various elements related to when do we start the second terminal, et cetera. While we are confident that all of this is within the frame of next 6 to 9 months, it is best that the leadership team of airports, which I will have here with me in -- post the half yearly results in September.

[Veenit Pasad, analyst]

Understood. Understood. I had a question on the airport city side development business as well, but I think I'll reserve that for the next call or should I go ahead with that?

[Jugeshinder Singh, executive]

No, it's overall -- just basic update I can share with you is that the planning of that at Ahmedabad is going well. But I think is...

[Veenit Pasad, analyst]

I wanted to just understand around the city side development that's been one of the growth avenues for us there. So how should we think about it from a next 3-year perspective, let's say? And will that city side development be largely restricted to Mumbai and Navi Mumbai Airport? And what sort of land parcels we have? And how should we think from a longer-term perspective?

[Jugeshinder Singh, executive]

Yes. So just to give you a snapshot idea of this because it's part of our overall disclosure review. So we roughly have around -- broadly 655 acres of land available across our 8 airports, Mumbai, Navi Mumbai, Ahmedabad, Jaipur, Lucknow, Guwahati, Bangalore and Trivandrum. Of this, our phase 1 development will be across 114 acres. Of the 114 acres, roughly 40%, that is roughly 50 acres will be Mumbai and Navi Mumbai. And the rest, which is just over 60 to 65 acres, will be in the other 6 airports.

In phase 1, the primary objectives are the -- on the city side is, one, commercial hotels, et cetera; two, retail entertainment and food courts, primarily serving the city side population, okay. And then from there onwards, phase 2 will have slightly different rental retail mix and phase 3 will have different rental retail mix. So broadly speaking, 114 acres are under development in phase 1.

[Veenit Pasad, analyst]

Understood. Okay. And what should be the CapEx involved to develop, let's say, 114 acres here, of which how much is already spent? And what could be the EBITDA potential from this 114 acres?

[Jugeshinder Singh, executive]

See that is what we are working through from all disclosure perspectives and forecast perspective at the moment. We will outline this very clearly in the -- post the half yearly results as a formal presentation. I don't want to give numbers that would -- that is still under evaluation internally. And we don't have the -- we haven't gone through -- not complete our detailed review of that.

[Veenit Pasad, analyst]

Okay. Understood. Understood, sir. Just last question from my side. There have been news articles of late around us closing the super app, the Adani One, given losses, et cetera, et cetera. So can you throw some light there? Are those reports true? And second, if yes, does that deter or impact our strategy in terms of driving non-aero revenues, customer experience in any manner?

[Jugeshinder Singh, executive]

No. I think the one -- I think generically, people just tend to make the commentary on tidbits of news, but I'll just clarify that since you asked the questions. See, when we started on this, we started on the basis that what should be the best use case that we will have. We were always very clear, the best use case for us for this is to -- like any other super app that has been successful in the world is to have a very defined use case that works. And the defined use case that works is -- for us initially, given the number of consumers is airports.

So consequently, we set this up. We looked at the broader architecture and then zeroed in on our use case that we had already outlined. And so the part of the press reports are correct in the sense that ADL is part of airports. That's the first use case is airports, so airports -- the entire airport use case is being developed fully as planned. And that's all that has happened.

[Operator]

[Operator Instructions] The next question comes from the line of Nirav Shah from Geecee Holdings.

[Nirav Shah, analyst]

Robbie sir, I mean, just a continuation of your opening remarks that 3 large projects are commissioning in this financial year. So what is the broad value that we have invested in these projects where the EBITDA contribution is just not there, but we've spent a significant amount like in Ganga Expressway, Kutch Copper, Navi Mumbai. And I would also add the PVC project where we have drawn some debt, but you would have invested far more than that. We would have invested the initial equity also. So if you can just separately give the value across these 4 large assets?

[Jugeshinder Singh, executive]

Sure. I think just to give you an idea, we have on our presentation, Page 22 and 23, but I'll spread out the numbers based on what you are asking. So for example, we have a total external debt in Adani Enterprise consolidated of INR 61,500 crores. Of this total external debt of INR 61,500 crores, roughly the INR 29,000 crore, which is roughly 50% of it is as follows: Navi Mumbai Airport, roughly INR 9,100 crore plus AAHL's greenfield developments, INR 3,000 crore. So INR 12,000 crore in the non-EBITDA currently assets under development of airports.

Copper is INR 7,300 crores and Ganga Expressway, INR 6,500 crores. And PVC currently drawn is INR 3,100 crores. So half of our -- roughly half of the net external debt is in assets that have yet to start contributing EBITDA. Although PVC will complete around 2028, but the other 3 assets are all -- will all be starting in the next 6 months to 9 months in this year. So that's where we are in total. We don't spread out the EBITDA, et cetera. We have a rate of return on these assets, which we highlight, and we expect that the rate of return on assets will be tracking above 15% on these assets.

[Nirav Shah, analyst]

Got it. Got it. And sir, what is the total CapEx on the PVC project?

[Jugeshinder Singh, executive]

See, PVC project, PVC to complete will be roughly INR 24,000 crores.

[Nirav Shah, analyst]

And the steady-state EBITDA generation on stabilization should be any ballpark number on base case assumptions, I mean, base cycle?

[Jugeshinder Singh, executive]

No, we -- there is the normal for process roughly of that type based on current market pricing, so I'm just going to caveat that on the materials. You would expect ROA on the total asset in this case at current market prices of roughly around, say, in the range of about 14% to 16%.

[Nirav Shah, analyst]

Got it. And sir, on Australia coal operations, can we share the EBITDA number? How much we -- how much did Carmichael mine reported?

[Jugeshinder Singh, executive]

Carmichael mine, yes, the mining business is not doing the segmental reporting on that other than the production and the dispatch numbers. So it's -- roughly speaking, what I can give you is that the revenue number for Carmichael is roughly at an average of around between -- the dispatch can range from 2.2 to 3 per quarter. But if the dispatch is say, what the current dispatch is 2.3, then the revenue is roughly around INR 1,050 crores.

[Nirav Shah, analyst]

Got it. But the PBIT is a sharp negative of INR 450 crores plus, so large part of that is depreciation or some accounting related line item?

[Jugeshinder Singh, executive]

So because internal mark-to-market of FX of our own -- Adani Enterprises' own internal loan.

[Nirav Shah, analyst]

And that amount would be, sir?

[Jugeshinder Singh, executive]

Over INR 500 crores.

[Operator]

The next question comes from the line of Nidhi Shah from ICICI Securities.

[Nidhi Shah, analyst]

So firstly, on the others component that we report in the segment reporting, we are seeing that the fluctuation in EBIT over there over the last 5 quarters has been quite significant. Could you probably outline what are some of the key businesses that make up these others? And if you could quantify specifically this quarter, what their contribution to the revenue and EBIT has been?

[Jugeshinder Singh, executive]

See, broadly speaking, the number was -- if you're referring, the number was higher largely due to the gain of the Wilmar sale in the others in Q4, okay, now last quarter. Otherwise, this number will track broadly at or around plus/minus INR 200 crores.

[Nidhi Shah, analyst]

Okay. And what are the major businesses?

[Jugeshinder Singh, executive]

The major business is just certain specialist industrial businesses, which supply some components to the defense, bunkering and so on and so forth.

[Nidhi Shah, analyst]

All right. And secondly, on the coal business. So we are seeing that the coal and the commercial mining are dragging this quarter. Are we expecting the situation -- market situation to get better, especially for the coal business anytime soon?

[Jugeshinder Singh, executive]

No. We think that the overall trade instability will last through this year.

[Operator]

The next question comes from the line of Prateek Kumar from Jefferies.

[Prateek Kumar, analyst]

Sir, my first question is on the copper segment. So you said that will commission by the end of this financial year. So in this year, you are not expecting any material EBITDA from that business. Just wanted to confirm that.

[Jugeshinder Singh, executive]

No, I think Prateek, just to clarify, the commissioning is done. It's just that the full ramp-up is what we were referring to, the completion of the ramp-up and stabilization, which we expect in the second half.

[Prateek Kumar, analyst]

But is the segment expected to contribute meaningful EBITDA in this year, assuming like full year EBITDA potential of INR 2,000 crores plus for next year?

[Jugeshinder Singh, executive]

No, it will be in the next year. This year, it will contribute much less.

[Prateek Kumar, analyst]

Second question, can you give like revised guidance on mining trading segment volumes and mining services volumes for the financial year?

[Jugeshinder Singh, executive]

I think from a guidance point of view, we don't expect the volumes to be impacted hugely. What we have -- we believe the trading instability that is there globally will last. So therefore, there will be pricing pressure on the realization. That we expect to last through the year. Volume-wise, I think from MDO, we will ship higher volume. Carmichael will ship its expected 15-odd million tonnes. Trading will be in the range that we expect trading to be, which is roughly -- slightly subdued, but roughly still be around -- averaging around 13-odd million metric tonnes per quarter. So from a shipping point -- volume point of view, no, we don't anticipate a change. But from a revenue perspective, MDO will continue to grow well. But the IRM business, given the trade issues in the world, there will be pricing pressure on commodities, so especially coal.

[Prateek Kumar, analyst]

Sure. Last question on your annual consolidated CapEx expectation for this year and next year?

[Jugeshinder Singh, executive]

I think, Prateek, that we have not changed the guidance from the last conference call. We expect to complete that CapEx.

[Prateek Kumar, analyst]

Okay. So mid INR 30,000 crores, INR 35,000 crores.

[Jugeshinder Singh, executive]

Yes.

[Operator]

[Operator Instructions] The next question comes from the line of Bhavik Shah from Invexa Capital.

[Bhavik Shah, analyst]

So my first question is just a continuation of the previous participant. Sir, can you just give us the breakup of segment-wise CapEx, like which business or which segment the CapEx we are going to do in FY '26?

[Jugeshinder Singh, executive]

See, roughly, just to give you an idea, airports, say, these are not precisely to decimal accurate. So INR 10,000 crore in airports, INR 6,200 crores Roads, around INR 1,600 crore in defense, about INR 1,000 crores in copper and associated businesses. Petchem will be about INR 9,000 crores further. MDO, natural resources, et cetera, INR 2,500 crores. And in manufacturing plus other part of the Adani New Industrial ecosystem, roughly about INR 5,500 crores. So total about INR 35,000 crore broken up like in the following manner.

[Bhavik Shah, analyst]

So INR 6,200 crores of what did you say?

[Jugeshinder Singh, executive]

Bhavik, are you there?

[Bhavik Shah, analyst]

Yes, yes, I'm there. Am I audible?

[Operator]

Yes, sir, you are audible.

[Bhavik Shah, analyst]

Yes. Sir, I was just saying INR 6,200 crores CapEx is for what, the money you mentioned?

[Jugeshinder Singh, executive]

I think we have lost him. Can we move to the next question, if there is any.

[Bhavik Shah, analyst]

Am I audible?

[Operator]

Yes, sir, the management is replying to your question.

[Bhavik Shah, analyst]

Okay. Sir, I'll just move on to the next question. Sir, can you give some EBITDA guidance on the new businesses? Like how much is the potential, say, from the copper...

[Jugeshinder Singh, executive]

Bhavik, you dropped. We can't hear you.

[Bhavik Shah, analyst]

Is it better now?

[Operator]

Sir, I can hear Mr. Bhavik.

[Bhavik Shah, analyst]

Yes. Am I audible to the management?

[Jugeshinder Singh, executive]

No, you are just audible now, but you are not audible at all before.

[Bhavik Shah, analyst]

Okay. Okay, sir. So I'm just saying, can you just give some idea on the EBITDA of the new businesses, which are going to be commissioned this year, the copper one, the Ganga Expressway and the Navi Mumbai Airport, like what is the potential of EBITDA there?

[Jugeshinder Singh, executive]

So I think we -- as I mentioned in the previous caller's question, we are not giving EBITDA guidance of those specific businesses. What we are saying is that we expect the rate of return on assets to be in the range of about 15% to 16%.

[Bhavik Shah, analyst]

Okay. Understood. And sir, like what is the plan in ANIL now, since like we are not doing any major CapEx there from the breakup I see. So are we like currently not doing any major investments on the green hydrogen side?

[Jugeshinder Singh, executive]

Yes, we are just currently conducting the testing on electrolyzers. So we are waiting for the results of the electrolyzer testing. So we have now -- currently, we have first non-grid-based electrolyzer operational. And so once we get the full results back, then we will take on with the CapEx based on the results.

[Bhavik Shah, analyst]

Okay. Understood. And sir, in the airport business, sir, when we ramp up the new Navi Mumbai Airport, we'll close down the T1 terminal. So what will be the impact of the closure of the T1 terminal?

[Jugeshinder Singh, executive]

No, no, we don't expect any impact overall on AAHL. And in fact, that will be well synchronized in the manner that the demand profile is such that, in fact, we will also have to start the development of the new terminal at Navi Mumbai very soon. So we will give you a full update post the half year report we will put that.

[Bhavik Shah, analyst]

Right, sir. And sir, just one question on the data center business. Sir, how much CapEx are we planning there?

[Jugeshinder Singh, executive]

Sanya, we have lost him I think again.

[Bhavik Shah, analyst]

I'm saying in data center business...

[Operator]

Sir, he is audible again. Can you hear him?

[Bhavik Shah, analyst]

Yes, I'm asking on the data center business. So what is our guidance for FY '26 in megawatt terms and in CapEx terms?

[Operator]

Sir, were you able to him? Ladies and gentlemen, as there are no further questions, I would now like to hand the conference over to the management for closing comments. Hello, sir?

[Jugeshinder Singh, executive]

Yes.

[Operator]

Were you not able to hear, sir?

[Jugeshinder Singh, executive]

No. We are not hearing any voice from there.

[Operator]

Is it audible now, sir?

[Jugeshinder Singh, executive]

Yes, yes.

[Operator]

Okay. So there are no further questions. So I would now like to hand the conference over to the management for closing comments.

[Jugeshinder Singh, executive]

Thank you very much to Investec and team and investors to join the call. Thank you for your questions, and Investec, thank you so much.

[Operator]

Thank you very much. On behalf of Investec India, that concludes this conference. Thank you all for joining us, and you may now disconnect your lines.