Adani Ports opts out of $553 million US DFC funding for Colombo project

Adani Ports and Special Economic Zones Ltd has informed that it has pulled back from financing deals with the US-government-backed International Development Finance Corporation (DFC).

Adani Ports says its Colombo West International Terminal (CWIT) project in Sri Lanka is progressing well and is on track for commissioning by early next year. "With reference to the captioned subject matter, we would like to inform that the CWIT project in Sri Lanka is progressing well and is on track for commissioning by early next year. The project will be financed through the company’s internal accruals and capital management plan. We have withdrawn our request for financing from the DFC," an Adani Ports statement says.

The statement didn't mention anything about the latest indictment of Adani Group Chairman Gautam Adani and seven others in a US court over the bribery allegations. The conglomerate has junked these charges, calling these charges "baseless".

In its annual report for FY 2023-24, Adani Ports had dubbed the U.S. DFC investment worth $553 million as a "strategic step" that showcased the "confidence of the DFC on Adani’s capabilities as well as towards bolstering Sri Lanka’s economic recovery through private sector‑led initiatives".

The U.S. DFC is America’s development bank, which partners with the private sector to finance solutions to the most critical challenges facing the developing world. Last year, DFC had announced $553 million in funding for the Sri Lankan port project.

The Adani group owns a 51% stake in the west container terminal of the port. Sri Lankan company John Keels Holdings owns a 34% stake in the port, while the rest is owned by the Sri Lankan Port Authority (SLPA).

A Chinese port company, China Merchants Port Holdings Co Ltd, also operate a terminal at the strategically important port. Adani Group had signed a strategic deal with John Keell Holdings and SLPA to develop and manage the strategic Colombo Port’s International Western Container Terminal in FY23.

Globally, Adani Ports operates in four ports outside India, including Haifa Port (integrated during the year), an under-construction container terminal in Colombo, Sri Lanka, and O&M contracts in Australia and Tanzania.

Shares of Adani Ports and SEZ, meanwhile, are trading in negative at ₹1,248.45, down 0.01% on the BSE. At the current price, the company's m-cap stands at ₹2.69 lakh crore.

APSEZ had posted a 37% growth in profit for the July-September quarter of FY 2024-25 at ₹2,413 crore compared with ₹1,762 crore in the corresponding quarter last year. Its revenue for the said quarter rose 6% YoY to ₹7,067 crore from ₹6,646 crore in the year-ago quarter. The company, in its guidance, said it was "well-positioned" to hit the upper end of FY25 EBITDA guidance of ₹17,000-18,000 crore.