The Business Model of Adani Group involve diversified interest in sectors like energy, infrastructure, driving profitability.

What is the Business Model of Adani Group?

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Introduction –

The Business Model of Adani Group involves diversified interests in sectors like energy, logistics, infrastructure, driving profitability. Through a case study, today we will try to know about the first generation entrepreneur, most of the business families in India are running a successful established business empire. In which all the businessmen from Tata to Ratan Tata to Mukesh Ambani are running the business of their previous generation. The same Gautam Adani started his business journey with the business of export and import from Adani Enterprises in 1988.
In the last 30 years, he has traveled on his own from becoming the richest person in India to becoming the richest person in Asia and one of the ten richest people in the world. In this, his most important art is that of communicating with people and taking the right decision at the right time, this has made him such a fast and successful businessman. In case study, we study different business houses and individuals. Which gives us something to learn and inspires.

We will see how Gautam Adani Group started its business journey and in which business Adani Group is trying its hand today. From listing our companies in the stock market, we will study the controversies and allegations behind them. We will see what is the business model of Adani Group and what are its chances of success in the future.

Life Journey of Gautam Adani –

His father Shantilal used to trade in Adani’s clothes and generally doing business in Gujarat is seen as a passion. It was in this environment that Gautam Adani was born in Ahmedabad, he had seven siblings in which Mansukhbhai was the eldest brother. At the age of 16, he came to Mumbai to try his hand, worked as an agent in the Mahindra Brothers Company, which was a Hero merchant, for three years and learned the nuances of the business in the true sense.

Gautam Adani’s first earning was ten thousand rupees as a commission from a Japanese customer. After working for three years in Mumbai, he joined their plastic pipe business at the behest of his elder brother Mansukhbhai. Due to the short supply of the material required for this business, he imported this material from outside India, due to which he got a lot of interest in this business and in 1988 he established a company named Adani Enterprises, which was the first business of export and import.

There were many ups and downs in his life, the most horrifying incident in which he was kidnapped in 1998 and money was demanded as ransom. The second time he was present in the 2008 terrorist attack at the Taj Hotel in Mumbai. In this way, twice in his life he has been witness to such a horrific event where anything could have happened. He learned a lot from this and this experience, he got into his business which is visible to us. Calmly taking the right decision at the right time, eliminating the risk with great ease, and a good network are their most important qualities.

History of Adani Group –

In 1981, when Gautam Adani was working as an agent in Hero’s business from Mumbai, his elder brother Mansukhbhai Adani called him back to Gujarat to handle a PVC plastics unit operation. Through this business, he started learning about import and export business and he developed an interest in this business. As a result, in 1985, he started a company called Adani Exports, which was converted into Adani Exports in 1988.

Even today this Adani Enterprises company is listed in the stock market as the main company of Adani Group and with it 6 more companies are listed in the stock market of Adani Group. The most important event for Gautam Adani and his group was the Gujarat government’s contract to run the Mudra port in 1995 which proved to be the foundation stone of the Adani Group. Even today this company is considered the most important company in the success of Adani Group.

After this, the Adani Group successfully tried all the businesses related to the port in the future in which they started business related to food and agriculture by taking coal business. He took advantage of the changed economic policy by the Government of India very effectively and entered from coal mines to oil, gas, electricity and thermal power. Like Reliance Group, he also established his feet in all fields and used his good political relations very effectively.

Business Model of Adani Group  –

  • Adani Port & Logistics
  • Adani Oil & Gas
  • Edible oil & food processing
  • Renewable Resources
  • Coal & Iron Ore mines

The economic changes introduced by the Indian government in the 1990s and the promotion of privatization through which government tenders and orders form the main source of the Adani Group’s business model. Adani Group runs business through its subsidiary companies through government mines and various government infrastructure projects, through which the contracts for running ports across the country are given by the government. In this, the Adani Group has increased its business in the country and abroad through seven listed companies and other private companies.

Today Adani Group is working in the field from oil and food items to electricity to be used in the homes of common people. For the past 30 years, Gautam Adani has established his business on a large scale in almost all sectors with his network quality and his business strategy. By the way, if seen, the profit percentage in their business is very less, but the courage to successfully complete government contracts and contracts through loans and through their networking skills has been done through Adani Group.

Gautam Adani and the Prime Minister of India are often criticized for their relationship, but he always believes that the businessman always has to be cooperative with the political people and work together. Their business model is quite heavy as this business model is not a skill and research base like Apple and Google. Therefore, there is a lot of risk in this business model, which can never be said.

Apple company makes its mobile from Foxconn company, chip is made from TSMC, hence their business model is called Light Business Model. The same Adani Group’s business model is a very heavy business model, which is very difficult to switch and the profit of margin is very low.

Business Profile of Adani Group  –

  • Name – Adani Group
  • Established – 20 July 1988
  • Founder – Gautam Adani
  • Business Sectors – Port Administration, Electric Power, Mining, Energy, Airport Operations, Oil-Gas, Food Processing, Data Storage, Defense Aerospace and Infrastructure etc.

Subsidiary companies

  • Adani Enterprises
  • Adani Port and SEZ
  • Adani Green Energy
  • Adani Power
  • Adani Transmission
  • North Queensland Export Terminal
  • Adani Foundation

Comparative analysis of Adani Group & Reliance Group –

Adani Group was founded by Gautam Adani, Reliance Group was founded by Dhirubhai Ambani, so Adani Group’s business is the first generation business and Dhirubhai Ambani’s business is established by his father. By the way, in today’s date, Reliance Group has a debt of 2.70 lakh crores, while Adani Group has a debt of 1.5 lakh crores. But when it comes to business performance, Reliance Group companies are performing better than Adani Group companies.

The performance of Adani Group companies has not been performing so well for the last 30 years, just that Adani Group is increasing its business through debt and through acquisitions. Reliance Group has entered the light model business of the market with companies like Google and Facebook through which it wants to increase its profit of margin and reduce the risk which is in the manufacturing sector and in the traditional oil and gas sector.

Adani Group’s companies have grown very fast in the stock market for the last few years, it is not visible that it has made a  profit as fast. In comparison, many Reliance Group companies have achieved better results. Gautam Adani has shown more interest in traditional business such as oil and gas and coal-iron mines, while Reliance Group has shifted its focus from its oil gas business to technology and services sector and to compete with foreign companies. is preparing.

Share Market & Adani Group  –

Gautam Adani’s wealth was US$ 50 billion in 2021, which has doubled this year. Debt is the main basis for the growth of Adani Group, but still investors are seen investing a large amount in the shares of Adani Group. According to the fundamentals of the company, the shares of the companies are going very high and based on the huge amount of news, the investments are getting more. The Adani Group mainly has contracted to provide services for government projects such as ports and airports.

The news that the Adani Group is going to benefit due to the long-standing relationship between the Prime Minister and Gautam Adani by the media, India’s stock market has increased significantly. Due to which the wealth of Gautam Adani has increased very rapidly for the last two years. Seven major companies of the Adani Group are listed in the Indian stock market, in which four companies are showing average performance and the rest of the companies are not showing such good performance, yet there is massive investment in Adani Group companies.

Businessmen were created by Putin in Russia under a strategy called business oligarch, who would promote the policies of the Putin government and protect the country from foreign companies. In India, under this strategy, a business group is being created by the government which will compete with American giants. In which the Adani Group is considered the most important. Therefore, through nationalism, large scale investments are being made in the Adani Group and other Indian companies. There are some experts like this.

Adani Group & International Market  –

Adani Wilmar Through this company, the company sells its products all over the world in a very effective way through home food production like Fortune Friends. By the way, the whole world sees India as a big market, but the purpose of Adani Group is to export its products not only to India’s market but also to Asia and other countries, it also considers it important.

Adani Group has created the world’s largest company through green energy, which manufactures green energy keeping in view the safety of nature and the company produces itself in all the business related to it, such as solar panels. The company has taken over the project of the world’s largest coal mine in Queensland and through this it has become the world’s largest coal mining company.

Adani Group has entered the international market through infrastructure and is working on very important projects. Port Business This is their most important business through which sea export is imported. Through which the sub-company has been set up to do business at all international levels from storage to production and it is believed that the company will benefit from it in future.

Controversies of Adani Group  –

In the area where Adani Group works, most of their projects are very big and it is opposed by many social organizations and political parties. Narendra Modi, who was the Chief Minister during the Gujarat riots in the 90s, was heavily criticized and attempts were made to jeopardize his government financially by an organization like CII. Gautam Adani preferred to stand with the Narendra Modi government at that time.

From the time when Narendra Modi became the Prime Minister of India in 2014, the wealth of Gautam Adani has increased very rapidly. For which his critics give credit to the Modi government. Credit Suisse had published a report by this organization that the fundamentals of the company are not good, against which Gautam Adani supported the development of his company and said that the company has very good projects and soon the company’s debts will be worked out.

His brother was arrested in the case of excise evasion, due to which there was a lot of discussion about the company, but even he did not back down and faced the situation firmly. A notice was issued to him by the ED, on which the company said that it was a routine investigation in which no financial matters of the company are disputed. Mudra Port and Australia’s Coal-mine Project were strongly opposed by the local people, in which they believed that nature would be harmed by these projects, but they believed that such protests are influenced by blackmail or politics.

Critical Analysis of Adani Group –

  • Most of the projects of the Adani Group are very grand, for which a lot of money has to be invested, which in the language of business is called heavy business model, which are very risky.
  • Adani Group Being a family business model, investing in it is very risky because if that person does not get competent leadership, then it will have a bad effect on the company.
  • Adani Group has been growing very fast since last 30 years, but the reason of growth is not performed, but they are entering other sector through debt and more than 50 percent stake has been pledged for this.
  • The company has not been successful till date in the technology sector, which is the most important business area of ​​the future.
  • For the company to enter any new field, an expert has to be taken into business through joint-venture, this indicates the weakness of the expert team of the company.
  • The shares of the company are increasing very fast in the stock market, but the performance of the company is increasing through the news, which is quite risky.
  • Gautam Adani’s closeness to the BJP has been criticized a lot and the company may have its brunt in the future.
  • Putin of Russia has formed a team of businessmen who runs on the purpose of Putin Government, which is called Voligar businessman, the same allegations are made against Adani Group which works under the influence of BJP government.

Conclusion –

The relationship between Gautam Adani and Narendra Modi, the founder of the Adani Group, is considered very old. During the Gujarat riots, when the central government was trying to isolate the Modi government in a political way, it is said that the Gujarat government was given moral support by Gautam Adani and some other Gujarat businessmen. When Gautam Adani is asks this question, he says that while doing business, any businessman has to keep good relations with all the political people so that they can work together.

He says that it is not that he has had relations with any particular party, he believes that it is not a bad thing to have good relations with all parties and people. He refrains from making any controversial statements, but many times during the election period, the opposition targets the relationship between him and the Prime Minister. Many of their projects have been opposed by the social organization and organization, but they believe that they oppose it by coming under the influence of someone and there is no fact in it.

In this way we have seen how he has grown his business so fast in the last 30 years. Twice in his life, he has struggled for life, surviving during the kidnapping and terrorist attacks. The most important part of his business strategy is his network and large scale business placement so that he uses his skills aggressively in risky business. In this way, we have tried to study all the aspects about Adani Group and Gautam Adani through this article.

BUSINESS MODEL OF BHARATI AIRTEL

 

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