In Indian corporate finance, few stories are as audacious—or as troubling—as that of Gautam Adani's meteoric rise to become one of the world's wealthiest men.
The Adani Group's debt-to-EBITDA ratio has climbed to 2.46 times in the first half of FY25, still the conglomerate continues its relentless expansion across India's infrastructure sphere.
What emerges from a deep examination of the group's financial architecture is a masterclass in leveraged expansion.
A strategy that has allowed the Adani family to build an empire worth over $200 billion while maintaining iron-fisted control through an intricate web of shareholding structures that would make even the most seasoned corporate finance professionals pause.
The Debt-Fueled Colossus
The numbers tell a story that is both impressive and alarming. Adani Group's total net debt has almost doubled in the past five years from $11.37 billion at the end of FY19 to $21.79 billion in FY24, representing a compounded annual growth rate of 14 percent.
The group's combined gross debt increased by 17.1% year-on-year to $33.6 billion as of September 2024, a staggering figure that dwarfs the GDP of many nations.
This debt accumulation was not born of desperation but of design. The Group discovered early that in India's relationship-driven economy, where political connections can unlock regulatory approvals and government contracts, debt could be transformed from a liability into a weapon of expansion.
Unlike equity, which dilutes control, debt allows founders to maintain their grip on power while scaling at unprecedented speed.
| Project | Structure & Ownership | Ultimate Control | Debt Mechanism (USD) |
|---|---|---|---|
| Mumbai Airport (MIAL) | Adani Airport Holdings Ltd → Mumbai International Airport Ltd; owned by Adani Enterprises Ltd (74%) and AAI (26%) | Gautam Adani (via listed and private holding companies) | ~$1.8 billion (₹15,000 Cr) in domestic bank loans + USD bonds |
| Carmichael Coal (linked to Port) | Adani Mining Pty Ltd (Australia), controlled via Adani Ports & SEZ Ltd; ownership through offshore trusts and FPI-linked entities | Adani family (notably Vinod Adani via offshore layers) | ~$2.5 billion in external debt + private placements |
| Mundra Port (India’s largest private port) | Adani Ports and SEZ Ltd; ownership by Adani family and Mauritius-based FPIs (e.g., Elara, Cresta) | Adani family (via Vinod Adani-aligned shell companies) | ~$900 million in USD bonds + ECBs + domestic structured debt |
| Green Energy Projects (Pan-India) | Adani Green Energy Ltd → Multiple SPVs; owned by Adani Enterprises and TotalEnergies (19.75%) | Adani family (operational control) | ~$2.1 billion via green bonds + ~$600M in IFC and private loans |
| Rajasthan Power Transmission Lines | Adani Transmission Ltd → ATL Rajasthan SPVs; shareholding via listed shares and family-controlled holding companies | Adani family | ~$1.2 billion in project bonds, securitized against transmission revenue |
The genius—and the danger—of the Adani model lies not solely in its appetite for debt, but in the sophisticated shareholding structure that insulates family control from external interference. Along with his brothers Rajesh and Vinod, Gautam collectively holds a significant 66.33% beneficial holding in Adani Enterprises, the group's flagship company.
This concentration of ownership extends across the conglomerate's portfolio, with the Adani SB Family Trust holding substantial stakes ranging from 20.76% in Adani Green Energy to 53.93% in Adani Energy Solutions.
But the true sophistication of the Adani control mechanism reveals itself in the offshore structures that have long puzzled regulators and researchers. Nine Mauritius-based funds that had parked over 90% of their managed fund value of $6.9 billion into Adani companies have been instrumental in providing what appears to be external validation for the group's valuations while maintaining family influence through complex beneficial ownership arrangements.
The most damning revelation came from investigative reports that exposed how the family invested hundreds of millions of dollars in their own company stocks, using offshore shell companies and an Emirati middleman to conceal their identity.
This alleged manipulation, between 2012 and 2018, involved layers of shell companies in Dubai and Mauritius that acted as intermediaries, creating the illusion of independent institutional investment while actually representing family money in disguise.
The Hindenburg Reckoning
The carefully constructed edifice began to show cracks when Hindenburg Research, a New York-based short-seller, published its explosive report in January 2023. The report accused the Adani Group of "brazen stock manipulation" and being "the largest con in corporate history." It triggered a market meltdown that wiped over $100 billion from the group's market capitalization.
What made the Hindenburg allegations particularly damaging was not only their scope covering decades of alleged fraud, but also their timing.
The report emerged just as Adani Enterprises was preparing a $2.4 billion public offering, forcing the company to cancel what would have been one of India's largest share sales.
Hindenburg revealed it made just $4.1 million in gross revenue through gains related to Adani short positions, a surprisingly modest sum that lent credibility to their claim that profit was not the primary motive.
Just as the Adani Group appeared to be recovering from the Hindenburg fallout, a new crisis emerged from an unexpected quarter; The United States justice system. In November 2024, federal prosecutors in Brooklyn unsealed a five-count indictment alleging that Gautam Adani and seven associates orchestrated a $250 million bribery scheme to secure lucrative solar energy contracts in India.
The allegations paint a picture of systematic corruption that goes to the heart of the Adani business model. Prosecutors claim that between 2020 and 2024, Adani and his co-defendants paid over $250 million in bribes to Indian government officials, with the expectation of generating $2 billion in profits over two decades.
What makes these allegations particularly serious is that [the defendants allegedly concealed the bribery scheme from US investors and international financial institutions while raising over $3 billion from American and international investors.
The SEC's parallel charges revealed the methodical nature of the alleged scheme. The offering materials for Adani Green included statements about its anti-corruption and anti-bribery efforts that were materially false or misleading, suggesting that the corruption was not merely operational but was actively concealed from investors and regulators.
The Partnership Paradox
Even as legal troubles mounted, the Adani Group continued to attract international partners, revealing the complex calculations that global corporations make when operating in emerging markets.
TotalEnergies' investments in Adani entities represented 2.7% ($3.8 billion) of the French energy giant's capital employed, but the company has been forced to suspend new investments following the US indictments.
The TotalEnergies partnership, which began in 2019 with investments totaling over $2.5 billion, exemplifies both the attraction and the risks of the Adani model.
The alliance aimed to create the world's largest green hydrogen and associated infrastructure with an investment of $50 billion over ten years, demonstrating Adani's ability to attract international capital even as questions swirled about the group's governance practices.
Perhaps most remarkably, the Adani Group has demonstrated an almost supernatural ability to recover from each crisis stronger than before. Despite the setbacks, most Adani stocks have rebounded, and the group has reported record earnings.
This resilience stems partly from the group's infrastructure-heavy portfolio, which generates predictable cash flows from long-term contracts, and partly from its deep integration into India's economic development story.
The group now maintains cash reserves of $6.36 billion, sufficient to cover 28 months of debt servicing, demonstrating improved financial management in the post-Hindenburg era.
Equity now accounts for almost two-thirds of total asset creation, a stark contrast to five years ago, suggesting a tactical shift toward more conservative financing.
The Succession Strategy
Looking ahead, Gautam Adani has begun orchestrating what may be his most ambitious project yet. Ensuring family control survives his own retirement.
Adani plans to step down at age 70 and shift control to his sons and their cousins in the early 2030s, with his four heirs becoming equal beneficiaries of the family trust.
This succession strategy reveals the ultimate goal of this family’s model. The creation of a dynastic business empire that can outlast its founder while maintaining the concentrated control that has enabled its rapid expansion.
A confidential agreement will dictate the transition of stakes in the conglomerate's firms to the heirs, ensuring that power remains within the family circle.
The Damodaran Verdict
We turn to Aswath Damodaran, the renowned NYU Stern professor widely regarded as the Dean of Valuation, whose sober appraisal of the Adani Group remains the most credible external diagnosis of its financial architecture.
He observes that the conglomerate carries nearly three times more debt than optimal. $4.96 billion against a modeled benchmark of $2.22 billion, pointing to what he calls “bad business practice,” not deception.
This misalignment, rooted in what Damodaran characterizes as a founder's obsession with control, drives decisions that sacrifice capital efficiency. Rather than diluting equity, the group opts for leverage, raising its funding costs and amplifying what he defines as truncation risk.
The professor's fair value estimate of Adani Enterprises—$11.34 per share—even under favorable assumptions of 30% revenue growth and doubling margins, stands in sharp contrast to its market valuation. He warns that these growth assumptions overlook structural limits. Infrastructure companies globally average just 4.8–5% returns, far below what Adani’s model implies.
He flags a systemic fragility, an inability of the group’s core businesses to organically generate the cash flows required to sustain inflated valuations. Debt, in this scenario, adds exposure rather than value unless it is indirectly subsidized through poorly priced lending, government favoritism, or yield-hungry green bondholders.
The analysis opens up a critical view into founder-led conglomerates where capital structure becomes a tool to entrench control, even if it compromises long-term resilience.
For Damodaran, Adani represents an economy-sized case study in how growth, pursued at all costs, can mutate into financial architecture that rewards scale over sustainability.
The real story is neither scandal nor spectacle but a deeper question of how modern finance operates where political proximity, capital opacity, and institutional silence can combine to prop up empire-building as a financial strategy.