The Adani Group – which is struggling to restore investor confidence following allegations of fraud – will invest in the construction and strengthening of logistics in UP.
Billionaire Gautam Adani’s conglomerate has announced to invest ₹24,000 crores in Uttar Pradesh, less than one-third of the investment pledged by his business rival Mukesh Ambani of Reliance Industries.
The announcement was made by his company executives at the ongoing Uttar Pradesh Global Investors Summit in Lucknow, although he could not make it to the gathering of businessmen on the first day.
The Adani Group – which is struggling to restore investor confidence following allegations of fraud levelled by a US-based short-seller – will invest in the construction and strengthening of logistics chains in Lucknow, Bahraich, Ghaziabad, Prayagraj, Bareilly, Moradabad, Meerut, Kanpur, Hapur and Noida.
The investment has the potential of generating employment opportunities for 15650 people, representatives of the Adani Group said.
Adani’s pledge for the investment comes days after the UP government cancelled a ₹5400-crore worth tender, awarded to his group, for the supply and operation of about 79 lakh smart prepaid electricity meters by Madhyanchal Vidyut Vitran Nigam Ltd.
In sharp contrast, Mukesh Ambani’s Reliance pledged ₹750 billion ($9.1 billion) of investment in Uttar Pradesh over the next four years. As part of the investment, his companies will be rolling out 5G mobile telephony services, expanding its retail network, and setting up renewable energy capacity, Ambani said at the two-day investors’ summit which kicked off on Friday.
Reliance will set up 10 GW of renewable capacity and start a bio-energy business in the state, said Ambani, adding that the investment would create 1 lakh jobs.
At the last year’s UP investor summit, Adani – whose interests range from ports, cement, energy, and logistics to media – had committed an investment of ₹70,000 crores with the potential to create 30,000 jobs.
Several companies of the Adani Group have lost almost half in valuation in one of the worst stock routs in recent times, which was triggered by a damning report published by a US-based short-seller.
In its report on January 24, Hindenburg Research accused the Adani Group of “pulling the largest con in corporate history” by way of stock manipulation and accounting fraud – charges denied by the industrial giant.
As the values of most of the Adani stocks fell by more than 50 per cent, Gautam Adani slipped to 22nd position from the third in the list of the world’s richest persons in just a matter of weeks.