Adani Green Energy Shares Gain On Reports Of $1B Sri Lanka Investment
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Shares of Adani Green Energy were gaining on Monday as the firm was reportedly eyeing a massive wind energy investment in Sri Lanka.

What Happened: The Adani Group company plans to invest over $1 billion (₹8,351 crore) in setting up wind energy projects in Sri Lanka in what would be the island nation’s single largest foreign direct investment and the biggest ever power project, PTI reported, citing sources.

The company will set up two wind farms in Sri Lanka’s Mannar town and Pooneryn village in the north with a total installed capacity of 484 megawatts with a $740 million (₹6,179 crore) investment.

Power transmission infrastructure will see another $290 million (₹2,421 crore) investment, sources told the news agency.

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The projects will not just be Sri Lanka’s largest renewable energy project but also the nation’s biggest power project to date.

Sri Lanka, which suffered from crippling power blackouts and fuel shortages during an economic crisis in 2022, has enacted new legislation to revamp the country’s power sector and attract investment in renewable energy.

Cutting Losses: The move, which is in line with the commitments made under a $2.9 billion (₹24,215 crore) aid from the International Monetary Fund (IMF), seeks to reduce losses in the state-run power company Ceylon Electricity Board (CEB) and make the sector more appealing to investors.

Adani’s project is also strategically important as it would restrict China’s economic influence in the Indian Ocean, particularly Sri Lanka’s northern region, which is very close to India’s southern mainland.

Adani’s project has reportedly received Sri Lankan cabinet approval and a power purchase agreement (PPA) is being finalised, post which the Indian giant will begin work and deliver the project in two years.

Adani’s tariff is lower than the government’s own wind power plant and the country’s fossil fuel-based power.

The project will contribute to Sri Lanka’s generating renewable energy to the tune of 150 crore units per annum, meeting the energy demand of about 6 lakh households. It will also generate 1,200 local jobs.

Adani Green had recently come under fire after a report from Snowcap Advisors accused the firm of inflated financial metrics, dubious accounting practices and looming funding gaps.

Price Action: Adani Green’s share price was up 0.97% at ₹1,882.40 near the start of trade on Monday.

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