Adani Group to take call on Adani Wilmar Joint Venture stake divestment in 3 months CFO Jusgeshinder Singh

The Adani Group is set to decide on the divestment of its stake in the Adani Wilmar joint venture within the next three months, according to Jusgeshinder Singh, the group’s Chief Financial Officer.

“We are currently studying the whether to keep or divest Wilmar stake,” Singh was quoted as saying by news agency Reuters on the sidelines of an event in Mumbai.

A report last month indicated that the Adani Group is in talks with various multinational consumer goods companies to divest its entire 43.97 per cent stake in Adani Wilmar Ltd.

The joint venture is well-known for its ownership of the Fortune brand, particularly recognized for its edible oils and packaged grocery products. Sources suggest that a deal could be finalized within a month.

The conglomerate, operating across diverse sectors from ports to renewable energy, is anticipating a sale price ranging between $2.5 billion to $3 billion for its stake in the joint venture with Singapore-based Wilmar International, which also holds an equivalent 43.97 per cent share in Adani Wilmar Ltd.

This is a part of Adani Group’s broader plan to exit certain businesses to make more substantial investments in core focus areas, primarily centered around infrastructure.

Adani Wilmar is a significant player in the edible oil sector with a strong market presence. In the previous fiscal year, the company reported a net profit of Rs 607 crore and revenues of Rs 55,262 crore.

However, it faced challenges in the second quarter of FY24, reporting a net loss of Rs 131 crore. The company had also posted a loss in the first quarter of the ongoing financial year.

This development occurs as promoters within the Adani Group consider selling stakes in non-core assets to establish a liquidity cushion, following a valuation dip triggered by a critical report from US short seller Hindenburg Research.