Adani Enterprises Limited (ADANIENT) Q2 2027 Earnings Call Transcript

Ladies and gentlemen, good day, and welcome to the Adani Enterprises Q2F527 earnings conference call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should we be listening during the conference call, please signal an operator by pressing star and then zero on your touch-tone phone. I now hand the conference over to Mr. Alok Diora. Thank you, and over to you.

Thank you. Good evening, everyone. On behalf of Motilag Oswal, I welcome you all to the 2QFI 27 earnings call of Adani Enterprises. So, we have with us the senior management from the company led by Mr. Arundh Bansal, Chief Executive Officer Adani Airport Holdings, Mr. Mourli Krishnan, Chief Executive Officer Adani New Industries Solar Manufacturing, Mr. Rajesh Podar, CFO Adani Airport Holdings, Mr. Manan Vakhariya, Head of Finance, Adani Enterprises, and Mr. Jitendra Kyalia, Investor Relations, Adani Enterprises. So, I would now hand over the call to Mr. Anund Bansal to provide opening remarks and then we can take up the Q&A. Thank you and over to you sir.

Thanks, Alok. Good evening, everyone. Thank you for joining us today for Adani Enterprise earnings call for the quarter and half year ended September 30th, 2026. AEL's portfolio comprises primarily of infrastructure-focused businesses, which spans across energy and utilities, transport and logistics, and primary industry. It is my pleasure to inform you that AEL achieved Credit rating upgrade to AAA stable by CARE during the first week of October 2026, its highest ever long-term rating in its credit history. This upgrade serves as an independent validation of AEL's disciplined capital management and tight fiscal prudence. As we informed in our earlier discussions, AEL's current fiscal results will reflect value unlock from investments made over the last few years and moving progressively from build-out phase to value-realization phase. AEL has reported its highest-ever half-yearly EBITDA of Rs. 11,958 crore. The strong EBITDA delivered is testimony of incubation business model. And the strength of our diversified business platform, backed by strong operating fundamentals, increasing asset maturity, and the ramp-up of newly commissioned Adani new industries module line capabilities. AEL is now well positioned to sustain this growth trajectory going forward. Moving to our half-yearly financial performance on a consolidated basis. Total income increased to 71,569 crores, an increase of 62% year-over-year. EBITDA increased to Rs. 11,958 crores, an increase of 56% year-over-year. Continuing profit before tax increased to Rs. 3,297 crores. An increase of 45% year-over-year. Adani Airport Holding Limited, EBITDA reported growth of 52% year-over-year to Rs. 3,275 crore. And KCL Copper EBITDA reported EBITDA of Rs. 2,033 crore. Now let me move to business-wise update. Our data center business. Adani Connects has signed up a new hyperscale contract of 240-megawatt capacity, taking cumulative contracted capacity to 1.2-plus-gigawatt. During the quarter, we handed over an additional 29.2-megawatt data center to customers, taking operational capacity to 94.6-megawatt. Moving to airport business. Adani Airport is one of India's largest private airport platforms, operating a portfolio of eight airports, including the Greenfield Navi Mumbai International Airport, and contributing approximately 23% of India's passenger traffic and 29% of countries' air cargo volume, underscoring our scale and strategic importance in India's aviation ecosystem. Adani Airport delivered a resilient performance during first half of this fiscal and achieved highest-ever half-year EBITDA of Rs. 3,275 crore, which is close to full-year EBITDA of financial year 25. This growth is achieved despite industry headwinds like elevated fuel prices and airspace disturbances. which have weighed negatively on passenger traffic. The effort put in over the last few years in developing non-aero strategy and ecosystem have provided resilience in this atmosphere. Our greenfield development of Navi Mumbai International Airport commends its international operations effective 15th July 26th. Indian Domestic Airlines, Indigo, Air India, and Akasa have recently announced their operational plans to commence international operations and progressively expand from Navi Mumbai Airport. Moving on to financial and operational bank performance during Q2, financial year 27. We handle passenger traffic of 21.3 million passengers. Total income of Rs. 3,786 crore, up by 20% year-over-year. EBITDA of Rs. 1,641 crore, up by 55% year-over-year. And Aero and Non-Aero revenue delivered year-over-year growth of 9% and 57% respectively. During the quarter, we added eight new routes and four new airlines. If I move to mining services portfolio, during the quarter, we dispatched volume up, stood at 10.7 million metric ton, while revenue stand at Rs. 998 crore and EBITDA of Rs. 407 crore. An integrated resource management business portfolio. During the quarter, trading volume stood at 7.4 million metric tons, and revenue stood at 7,169 crores, and EBITDA of 654 crores. In copper business, we are now seeing capacity ramp-up. During the quarter, copper sales volume of 80.6 kiloton with capacity utilization increased to 64%. Revenue increased to Rs. 14,843 crore, and EBITDA increased to Rs. 1,283 crore. With this, now I hand over the call to my colleague, Murali Krishnan, CEO of Adani Solar. Over to you, Murali.

Thank you, Arun. Good evening, ladies and gentlemen. Adani New Energy Ecosystem is developing an end-to-end integrated ecosystem for manufacturing solar modules and wind equipments. As all of you know, Adani Solar has featured in the elite list of top 10 global solar module manufacturing and Adani Wind became the only Indian company in top 15 global wind turbine manufacturers. I'm happy to inform you that we have commissioned the remaining module line capacity of 4.3 gigawatt on 31st of August 2026, completing our expansion to 10 gigawatt module line capacity. We are on schedule to commission the solar cell line of 6 gigawatt by end of this financial year. During the quarter, domestic module sales have increased to 1,478 MW, up by 35% year on year. This demonstrates strong demand of Adani solar modules in domestic market, which has fully absorbed the export intake. Now, moving into the financial and operational performance of Q2 F527. The module sales was 1,478 MW, up by 35% year-on-year. Wind turbine sales was to 35 sets, up by 25% year-on-year. Total income stood at 3,669 crores, with an EBITDA at 1,094 crores. Now this session is open for question and answer.

Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on your touchtone telephone. If you wish to remove yourself from the question key, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question key assembles. We have the first question of the line of Manish A. Somaya from Cantor. Please go ahead.

Good evening.

Can you hear me? Yes, we can hear you, Manish.

Okay, wonderful. I wanted to ask my first question on the airport business, specifically on Nabi Mumbai. Perhaps if Arun can talk about the key traffic yield and cost milestones over the next 12, 15 months that we should be. Thinking about as that airport ramps up, and what are sort of some of the meaningful contributions to profitability and cash flow that we should think about?

Now, thanks for your question. So, NMIL, as I said in my commentary, we started the commercial international operations from 26th of July. As you might have seen recently, together with Indian carriers, Indigo, ACASA, and Air India, We have announced the new international routes. Actually, Indigo has announced 12 new routes from Navi Mumbai, starting from December up to April, summer schedule 27. Air India Group has announced seven international routes from Navi Mumbai, and ACASA has announced one additional. So that makes 19 international routes, one is existing from Navi Mumbai. Domestic, also, we see a proportionate growth. So, our guidance is that, We will exit next financial year with full capacity at Navi Mumbai. So Navi Mumbai, as you know, the capacity we can handle is max 20 million, which is 5 million international and 15 domestic. And we will exit next financial year, i.e. Q1 2028, running with a run rate of 5 million per quarter.

Okay, that's helpful.

And then on data centers, it's obviously great to see the tie-up with a new hyperscaler. The capacity is now 1.2 gigawatts plus. If you guys can help us understand how we should think about the commissioning schedule and what level of equity in CapEx, you know, we should be kind of baking in as we think about that.

Hi, Manish. Manan, over to your...

Yeah, so... In terms of data center, we will stick to what we discussed in terms of our Armin goal discussed during Q1, where we are expecting in the range of 120 to 150 megawatt of operational capacity as a capacity of when we exit FY27, the current fiscal, and over next 12 to 18 months, we will significantly ramp up all the remaining projects and we should be expecting close to 500 megawatt of operational capacity, We will start billing to the customers. In terms of the capex and equity requirement is something where we expect this project to be funded approximately 20, 80 to 30, 70 kind of scenarios. And we will have the same capex numbers as generally are there for any other players. Because we are primarily in the core and shell, MVP and all the structure and we're not a cool player where we install our servers also because that is in the scope of customs.

Okay. Thank you, Manan. And then just lastly on Roots for me, now that Ganga Expressway is operational, how should we think about the recurring toll and annuity income becoming sort of the dominant force when it comes to earnings? Thanks, everyone. You know, that's something that I think we have yet to see, so I'm hoping you can help us with some of the key milestones we should be watching for over the next few quarters.

So I think starting last quarter, we have fairly entered into an area where the numbers in the P&L or the reported numbers reflect the annuity income as well as ongoing toll income. What we should expect going forward is the increase or the optimum utilization of the road where the toll incovers are to be generated. So, as the traffic grows and as the traffic picks up across the lines of newly committed toll routes, including Ganga Expressway, you will see those ramp-up numbers coming in. But when you compare year-on-year, because of how the end-end accounting works for the service-consistent accounting, you will see some kind of variability in the revenue numbers. I understood pretty much that is your question. Otherwise, you will see the normalization has already happened and you will see this continue for a few quarters in the next period. But as the construction has started for the new project, you will see that again being reflected in the PLN.

Okay. That's super helpful. I'll get back in the queue, and I appreciate the time. Thank you.

Thank you. We have the next question from the line of Mohit Kumar from ICIC Securities. Please go ahead.

Yeah. Good evening, and thank you for taking my question. My first question is on the Bangalore tunnel, which I think is L1. Is there any update on that project you can share?

No, so it is at the same level. So that is what we know from the authorities that we are L1. There is no further development there as well.

Understood. Coming back is one suggestion for the road. Road is a bit. Of course, you understand that we are doing AC accounting. Is it possible to share the operational report going forward, given that our last three projects have got operational for Ganga Expressway, is it possible to share the operational report going forward in the PPT that we have for us?

Sure, we can include this, but for the reference, for your reference and for the benefit of everybody, we will share the numbers over the call as well. So our EBITDA for roads business for Q2 is 354 crore and Q1 was 288. So that takes us to half yearly number of around 642 crore of EBITDA for roads.

I understood. Going back to the airport business, I think we were expecting to commence the work on phase two of New Mumbai. Is there any, yeah, can you just update us on that? Given that the, of course, the traffic is below par, are we postponing that capex? And the second question of the airport business is, of last year, if you look at the non-aero business, I think we took over the ground handling, I think somewhere in Q1, FY26, right? And that particular revenue is not present in the base quarter, while you see that number is present in the Q1 and Q2 FY27. Can you help us to understand that line item?

So I'll take the first question, Arun, here, and then Rajesh will help you with the second question on exact numbers. So phase two of Navi Mumbai has already kicked off. We have already onboarded the international consultant, and the design work is ongoing. We are also in the process of finalizing the GC contractor, which will be onboarded within very, very soon. So phase 2 of Terminal 2 of Navi Mumbai, the actual work will start within the month of November, this year. Understood.

And is the ground happening, sir?

Yes, in case of ground handling, Rajesh, in case of ground handling, we had commenced operations at Mumbai, Ahmedabad, Nari, Mumbai, through 100% subsidiary AGH port, and during this particular H-1, we have earned a revenue of around 339 crore rupees for a six-month period.

So this was not present last fiscal completely, is it right?

Yeah, that is fine.

So, Mohit, the entity was acquired and insourced somewhere in the middle of November. So, it actually was present for approximately three or four months in the last financial year. So, yes, if you look at the half-year number, it was not materially there.

Understood. Now, my question on the solar and wind. Sir, on this particular quarter, do you have any idea how much is sold in the rooftop? And are you thinking about setting up ingot and wafer now?

So, there are two questions, sir. One is that on the rooftop, actually 56% of our sale was into the rooftop. The market. And in terms of ingot wafer, I would say that we already have 2.2 gigawatt of ingot wafer capacity, and the balance capacity will come up by 2028, which we are already working on. The engineering work is already started. So that will well align with the ALMM3 policy.

So, you've commenced work on the balanced 8 gigawatt of inked and wafer. Is that understanding correct, sir?

Yeah, it will be actually a bit more than 6 gigawatt because if you look at technically, the yield factor is approximately around 7 to 88% raised to the nameplate capacity world over. So, accordingly, the capacity installed will be slightly higher than the cell capacity what we have already in hand.

Understood. Is it possible to share the solar order book and the wind order book at the end of Q2?

So, in general, I can only say that our capacity is already booked for it, both for wind as well as solar. We will not be in a position to give you the exact numbers at this point in time, but I can assure you that the order book is already booked.

Understood. The last question is, how much are CAPEX done in H1, and is it possible to give us the broad break of the CAPEX segment-wise?

Mohit, what we have done is, we have included standard FAQs as a part of our presentation, where we have included full breakup of the FAQs for the FAQs.

Sure, understood. One more question that I ask, you know, in your PPT of data center, I think there was the contact reservation, right, which was 1.2 gigawatt. I think this was shared, I think, by end of F26. Do we have similar number for by end of Q2 F527?

Sorry, come on in.

In a investor PPT, which was shared earlier, there was a data center capacity of 1.2 gigawatts, which was under contract reservation. Can you help us understand the definition of contract reservation and what is that number at the end of Q2F527?

So, see what you can refer our data center slide what we have included as a part of our presentation. So, we are constructing data centers of 1.4 gigawatt capacity already. Correct, correct, correct. So, those are at various stages. Out of this, the capacity of 1.2 gigawatt is already tied up and is at a different level of implementation and the project construction and the remaining capacity is open and which can be taken up by everybody.

Maybe I'll take it offline. I'll speak to you later. Okay. Thank you. Thank you for asking your question. Thank you.

Thank you. We have the next question. Line of Pratik Kumar from Jefferies. Please go ahead.

Yeah, good evening. Congrats for a great set of results. My first question is on airport business. Sir, can you discuss progress on real estate capex and any specific milestone you are looking at by and low F527, F528 for city-side development?

Yeah, so city-side development, we have signed the contract, the HMA for all the hotels we are building. Basically, with our partners, the work is ongoing at five assets, Mumbai, Navi Mumbai, Ahmedabad, Jaipur, sorry, Lucknow, and Goati, and the work at Jaipur will start very, very soon. The phase one, as I call it, we will be live at Ahmedabad by October 29, at Mumbai and Navi Mumbai by March 2030. Then we are undertaking some major CAPEX project on aeronautical side. As I said before, we are building a completely new terminal, Terminal 2 at Navi Mumbai. We are doing a redevelopment of Terminal 1 at Mayar, which will start from Q1 next year. We are building a completely new integrated terminal at Ahmedabad in line with the Commonwealth Games, which Ahmedabad City will host in October 2030. So that terminal will be ready. And we are doing some minor additions of capacity at Terminal 2 in Mial, building additional capacity at Trivandrum, and a new terminal at Jaipur. So, there are a lot of... CapEx, heavy CapEx items, which are work in progress from now until 2029-2030.

In the data center business, can you discuss the recent joint venture with Jabil Adani, Jabil Partnership, and what is the scope of the business and what is the, is this a new apex with the companies in messaging? And the question on Vika Center is like, we do read about a lot of position Thank you very much. Thank you very much. So, we are looking at the status of land acquisition or whatever is required for these projects, which suggests that our projects are on time and we are looking at 2 years of our capacity by probably FI 30.

Hi Pratik, thank you. So, you have two parts in your data center question. So, I'll take first on Jabil. So, yes. So, the present joint venture, which is with Edge Connects, is completely a data center play in terms of it operates in building and constructing the data centers, core and shell, ABP solutions, and other related stuff, which you know about this. And what goes inside the data center is generally within the scope of customers. Now, what we seek to do with Javil is that it's a completely new development, different and separate from Adani Connects, where Adani Enterprise and Javil are looking to manufacture the AI RECs and the data servers and the related equipments. And the manufacturing facility will be set up in the country. So, it is still at an AOU stage and we are looking to finalize the definitive agreement over a few months. And once we have those signed, we will come up with the proper disclosure in line with the regulatory requirement and we will have the details included in our CAPEX and other segments. So, that was part one of your question. Part two, yes, the… Various data center locations which we have defined in our earnings presentation, we have access to majority of those leads and are already acquired or are in the very advanced stage of completing the acquisition. So we are very confident that these projects will be completed as planned and as envisage.

And just to confirm, you said the operation capacity moves from current 95 to 125 to 150 by 27 and 500 by 28 and is that the number you said?

500 over next, yeah, 18 months, yeah, so practically, yes.

Sure. On road segment, the performance or progress or the ramp up at the new project seems a bit slow. Is that underwhelming versus company-owned estimates and how do you see like kind of progressing on a quarterly basis?

I think it is progressing well, but they are slightly off the mark where we would otherwise like those numbers to be in terms of the capacity ramp up and the total projects. But this is practically Q2 being a seasonally rainy season plus the heavy floods and the situation in the north part of the country. So we will discount that. But as we speak today, we are seeing a good progress and increase towards what we are expecting. We are expecting the number to be. So yes, it's slightly over the back currently, but yes, we will get to the next two quarters.

Last two questions, firstly on Anil, we have commissioned new capacity module, what is the run rate of the volumes with the significant increase in capacity which we have now over the next two quarters?

Yeah, we are expecting about 2 gigawatts for the next quarter and that will be the run rate that we should be going with the new capacity coming in.

Thank you, sir. And in this, what is the mix of volumes like rooftop or to captive volumes building significantly increase to Adani Green or how do you expect to sell this volume?

So, as I have already mentioned previously that the capacity for the cell is expected to be commissioned during this financial year, towards the back end of this financial year. As the cell capacity coming in, actually the DCR content will be increasing and that will increase the rooftop because that requires the DCR requirements. So, we will be also having OCR capacity which will be used for the captive in the next two quarters considerably.

Last question on the mining service and Adam. How should I mean these two segments are also seen slower volumes recently? How should we look at the annual volumes for these segments?

So I think these two quarters are comparatively lower, but we expect them to grow from here in the remaining two quarters. And we should be at least 10 to 15 percent higher than where we ended last year.

Sure. Thank you for answering all my questions.

Yeah. For mining services particularly and coal trading or the IRM is typically, it's more of a market-driven thing. So, it will be difficult to give you any outlook given the coal shortage situation in the country.

Sure. Thank you all, and welcome to the next session.

Thank you. Participants who wish to ask a question may press star and one on your touchtone telephone. We have the next question to line up. Bibharma from MK Global, please go ahead.

Good evening, everyone, and congratulations on the excellent numbers. My first question is on the non-arrow revenue that saw significant year-on-year jump. So, could you please highlight what led to such significant jump in non-arrow revenue?

Well, thanks for the question. So, non-arrow, our strategy has been threefold, basically. Number one, we are heavily investing in digitization. So we are working with Adani One app, which we have revamped to focus only on airports. And hence, we are able to increase the penetration year over year. This quarter, we had almost 25% of our non-aero transactions have happened over digital. As a result of that, we are able to increase the average transaction value per passenger. We are able to increase the The penetration. And the third thing is we are able to premiumize most of our shops. We have brought in new lounges on board. And of course, Navi Mumbai initial ramp up also helped because Navi Mumbai, there was no non-aero revenue last year. So combination of all those has helped. And partly also the ground handling services, as one of the colleagues asked, there was no ground handling last year, which got incorporated this year. So multiple factors contributed to a strong non-aero growth.

Okay.

Now, Mr. Bipulab Rikishu, come kindly closer to the microphone. I see I'm able to hear you very clearly.

Okay. Hello. Am I... Is it okay now?

This is much better, yes. Okay. Okay. Thank you.

So, my second question is on the CapEx commitment. You have quite significant CapEx expected in airports. In data centers, I think even in defense. So could you give us some kind of color on the CapEx commitment over the next three to five years, and which business segment will have significant CapEx? That's my second question. Hi, Biffler.

So, we have given the capex which is already incurred as a part of our standard details in the presentation itself. In terms of the outlook, we will stick to what we outlined in our earnings call during Q1. So, we expect to do the capex at a run rate of around 40,000 crore. So, we may be somewhere in the 35 to 40,000 crore, which is a run rate we expect to continue and over next couple of years. And the heavy lifting will be done obviously by airports, data center and BBC.

Okay, okay, that's it.

And just wondering, sir, you know, you had an excellent result. And what kind of EBITDA do you think in FI 27 will end up with and the kind of margin that we think that we'll do in FI 27-28?

I think people, we refrain from giving any specific financial guidance. My apologies for not being able to answer this, but yeah.

That's fine. That's fine. Thank you. Thank you. And all the best. And congratulations.

Thank you. We have the next question, one of the people in Europe, please go ahead.

Sir, good evening and congratulations on our decent numbers. Sir, just had a couple of questions. The copper business has seen significant traction. So, do we see this run rate kind of continuing or would it would we even see better run rate in coming quarters? So, that's question one. And the second question is that we we have been seeing that airlines being little hesitant to move from the you know, our T1, T2 airport to Navi Mumbai. So what kind of implications Can we, can it have on us? Or if you can just throw some light on that, or is there any impact at all?

So let me answer the airline question, and then Manan, my colleague, will answer the copper question. So, airlines, of course, this is a very consultative and long-drawn process where we need to then get the confidence of airline that infrastructure is ready at Navi Mumbai, and it always happens whenever new infrastructure comes in. As you would have seen on this Sunday and Monday between three domestic carriers, We have announced the movement of between those three 18 international flights from existing Mumbai to Navi Mumbai that cater for roughly yearly volume of 3 million. And we are in discussion with more airlines to move the traffic for us to be able to redevelop the T1. And we are fairly confident, as I said earlier, that we will end financial year 27-28 with a run rate of 20 million, which is the peak capacity of Navi Mumbai. Over to Manan for copper question.

Thank you, sir. So, hi, Alok. Cooper is, yeah, so we have two very good quarters in terms of Q1 and Q2, and the Q2 has been very good. So, if you look at the margins that we make on our revenues, so Imitra is the percent of revenue, it has been around 7 to 8.5 percent is the range where we have operated during, but on a long-term basis, our estimate is, because this is very commoditized business, and the prices have ramped up in some of the byproducts, like succulic assets. So, that is something which have contributed to the good set of numbers, but on a long term basis, yes, our utilization of the plant and the ramp up will increase from 64% in Q2 to around 80-85% as we close the this current financial year. So the absolute number will definitely increase in terms of revenue, but our. Operating range for current fiscal may be slightly higher, but yes, on a long-term basis, it will be around 4 to 6% is the range where we will operate as a margin. But yes, as we increase our plat utilizes, the absolute number can be around the same number where we are.

I got it sir. So, just one follow up on the airlines answer which you had given. So, just wanted to understand if there is any delay in airlines remaining airlines willing to shift the operation. So, does it have any implication on us or it really does not change anything as far as We as airport operator is concerned.

No, so, you know, the timeline to start the redevelopment or demolition part of T1 is fixed. We will start from summer schedule, which is April 2027. So, airlines will have to make a choice, certain airlines, not all. Either they move to Navi Mumbai or temporarily stop flying to Mumbai. These are, I'm mainly talking about international airlines. But there are very few discussions left, and I'm fairly confident that collaboratively in next one month, we would be able to come to a conclusion with those airlines also. There might be one or two airlines who decide not to operate for Mumbai for a couple of years, but that will have almost no impact on the overall passenger count.

Got it, sir. That's very helpful.

Thank you, sir. All the best.

Thank you. We have the next question. I know Pratik Singh from IFL Capital. Please go ahead.

Hi, good evening. Thanks for the opportunity. The first question is on the solar business. Just looking at it, it looks like relations have fallen on a QOQ basis, but EBITDA margins or EBITDA per unit has gone up. To what are the key 2-3 parameters which are driving it?

Yeah, so if you look at the Q1 results, what we have given as well as in the earnings call, we mentioned that we have closed some of the advanced authorization, which is approximately around 89 crores impact that has come up. So that is one of the main reasons for this impact. Does it answer your question?

Yeah, understood. Now, second on the data center business, as you are incrementally signing pay lease contracts with multiple hyperscalers sequentially every quarter, on a lag-to-lag basis, I said it might be difficult, but on a lag-to-lag basis, are you seeing an increase in rental rates over time in dollar terms?

So, we can get you the specific details and come back on this, but broadly, there have been some increase in the rates over the last six months, but they are not material in terms of where we are looking at those numbers. So, broadly, the ROCE or the return on capital we were making earlier are stable in terms of the data center. That is our scope of work in the Adhari Cadence.

I understand, but given that we lock in capital 60 to 80 crores per megawatt and… We have seen commodity price inflation, there is a tightness in equipment supply as well, so there might be a risk that capex per megawatt would be going above what we earlier thought maybe six seven months back. So is this something when we negotiate with hyperscalers, they agree and they agree to higher rates or we are still in the process where we want to lock in as much capacity as possible and at slightly higher rates than needed.

When I answered you earlier, what I meant was we protect our return on capital employees that we want to make as a part of this business. So wherever we are seeing the increased capex, that will be factored in when the billing is considered for the new sign-up or the new sign-up of the project which we are doing. So, given that, Discounting for that, everything, the rates are more or less stable in the broad, same rate where we were operating earlier.

Understood. My third question is on the copper business. So, we have been hearing a lot, obviously, TTC, RCA are negative, availability of consent rates is very tight globally. Have you been facing any issues sequentially in procuring supply or things are fine right now and we are able to procure supply at decent costs?

So far as the procuring of raw material is concerned, we have not seen any significant challenge in terms of what we are hearing otherwise in the market because we have some of the long-term contracts tied up to a significant part of our requirement that insulates us from such variations in the market. So as of now, we have not seen any situations where we are not able to procure the proper contract.

Thanks. Just two bookkeeping questions very quickly. Your investments in JVs and Associates is around 2400 crores in first half, similar level which we did in the entire F26. So, it's here to assume it's largely data center.

It's primarily data center, yes. In which you are saying investment in equity account and investment, right? Correct, correct. Yeah, so that is the data center.

Okay, and the last question, I can take it offline also. So, the other expenses line item in our P&L at 6,500 close this quarter is the lowest in three years. What exactly is driving it? Thank you.

So that will go down to again the index accounting of the service-conscious contracts where the construction of road activities are generally passed through P&L. That's why you see the P&L bloated to the extent of revenue and expenses both because the construction expenses are passed through your P&L and that is something which is causing the variation in the other expenses.

Very well, that explains it. Thanks a lot and all the best.

Thank you. We have the next question of Karthik Kohli from Court of Securities. Please go ahead.

Thank you for taking my question. My question is, is there an element of fixed portion of the call? This non-aero revenue being accounted for, which is related to new shops being opened at say Navi Mumbai Airport or say the newer just renovated shops opened at Mumbai Airport.

Is there a fixed element in this which is contributing to the growth? I don't know why I want to say that will be my first question.

No, thanks for the question. So there is one element which was specific to Q2, and that is the new hangar sale we have done at Navi Mumbai, which got recorded in Q2 Financial. That's all the new opening of shops, new lounges, everything is a recurring business which will continue.

My second question is on data centers. So, it is more on broader business terms. We wanted to understand that since you are signing up, you are not clearly audible.

Hi. Hi, Karthik. You are not clearly audible.

Mr. Karthik, can you kindly come closer to the microphone so that we can hear you loud and clear?

Charles, is this better?

Yes, we can hear you now. Yeah, sorry.

So the last thing on data center, we need to understand from a broader business perspective, now that you're signing contracts with, you know, a lot of hyperscalers across the globe and a lot of these players have undertaken a lot of debt. So is there a, you know, fail safe in your agreement with such hyperscalers in terms of take or pay agreement and, you know, any such protection that will allow you to, you know, recoup at least part of the, Is there a failsafe for that?

I think it is there as a part of normal contractual commitment. It is always there. There are safeguards and the guardrails which are built out in any agreement. Those general contractual guardrails are there. But on specifics of take or pay, I think we will have to check and come back after the contract and the legal review.

Okay, understood. Secondly, on the services business within Adani Connects, just wanted to understand what sort of services are being envisaged there and what sort of, you know, contribution to overall margins that can come from there. Is there a sense we can get here?

You said Adani Connects, right?

Yeah, so within the business there is a managed service element and O&M element. I just wanted to get a sense of what sort of Iribita contribution or at least on our margin contribution that can come from them.

So, I think we have not given or publicly disclosed as a part of our early presentation, the data center number yet, which we plan to do somewhere towards the end of the year. So, we will have the financial disclosure coming up there. So, I think that is where we will try to include those breakups as well. But largely, the majority part of the revenue and the EBITDA will flow from the lease rental kind of mechanism where the opt-in is taken up by the hyperscalers.

Understood. Just to slip in one last question, because you mentioned on Kutch Copper that a major chunk of your raw material from that from the perspective of the copper business is already account taken care of. Could you specify to what degree that you have a contracting place for your capacity utilization?

In terms of uptake or the procurement?

Both, off-take or procurement, whatever number that can be provided.

Yes, so Optech, in terms of Optech, if you really look at, we have two joint ventures which are in-house in terms of the copper tube. So, that gives us assurance of the Optech for around 12 to 15% of power capacity. Excluding that, copper is something which gets imported in the country. So, we are always demand heavy country against the what is the supply available in the country. So, that's where we are not very much worried about the Optech is concerned. In terms of procurement, we have already tied up approximately 50 to 60% of our long-term requirement of the long-term basis and on a short-term basis, another 20% is already contracted. So, we expect the plan to continue to operate towards the end of the year by 80-85% as I highlighted earlier. So, that's where I think so in that sense, we are fully secured from the supply chain Thank you.

Understood, sir.

Thank you so much. Thank you. For participants who wish to ask a question, may press star and 1 on your touchtone telephone. We have the next question from the line of Pratik Kumar from Jefferies. Please go ahead.

Yeah, thanks for the opportunity again. I have just one question. We had acquired the JPA assets via the NCLT route earlier this year. I know cement business and power business was directed to the company. This hotel and F1 and the big land parcel in Greater Noida all kind of remained with the Rani enterprise. What are the plans for all these assets? The S1D start happening in Adani enterprise itself or in a separate entity?

Hi Pratik, so you are right, the bidding entity was Adani Enterprises, but the implementing agency for, it was not Adani Enterprises, it was a private entity called Adani for India Limited. So nothing of the JL acquisition remains with us and is completely off the table for Adani, so far as AEL is concerned. We have not contributed any equity or any funding also in the project, so we are, it is completely off AEM.

Sure, thank you.

Thank you. We have the next question on the line of Deval Shah from RBSA Investment Manager. Please go ahead. Deval, we are not able to hear you very well. Rakesh should kindly come closer to the microphone.

Yeah, hello.

Hello, is it audible now? Yes, we can hear you now.

Yeah, so I just wanted to get some more insight on the primary industry. I see that we have significantly increased our EBITDA, and this includes the metals, mining, and the iron specialist manufacturing. Significantly, probably would be contributed by the copper, but I would just like to get some more insight into this 5,000 crores EBITDA.

So, you are right. Primarily, the increase which you see on the first slide or the second slide of the presentation is come from the copper. Apart from that, the major contributors are integrated resource management and the mining services for which we disclose the results and the segmental numbers separately. And one more part, which is part of the primary industry is Carmichael mine. And that is where against the last year, because of the coal prices are good and the plant is running at an optimum capacity, the mine is running at an optimum capacity. The emitter started flowing from that mine as well. And that is where we have for the quarter two, we have done an emitter of around 470 crores. And cumulatively for the half year, the EBITDA has been at 840 crores, which was generally our annual run rate, expected run rate. So because of the good prices, those numbers have come out good. And that is what I think will make up for the remaining part which you are looking at.

Okay, and about the specialist manufacturing, so can you please give some more insight into it and what sort of capital we are committing and the size which probably we are thinking of in terms of the revenue and debita?

So the specialized manufacturing is primarily defense that we refer to. And so in terms of the overall numbers that we are presenting, those are not very significant and that's why they do not pass the criteria of segment reporting. And hence those are not separately reported. But yes, we are doing meaningful work there, but nothing which can be reported is okay.

Okay, and since last, what I have seen that we have almost about 18 to 20% of our capital has gone into PVC. So, can you please give us a more insight on the timelines about the PVC business and where we are, some more insight into the entire segment?

So, yes. So, we are constructing one million metric ton capacity plant at Budra, and very It's approximately 26,000 crore capex plant that we are building up there. Out of this, I think we have already closed 60% mark in terms of the project spend as well as the construction on ground which we propose to do there. So as per timeline, the first part of the overall capex is expected to get commissioned in the next fiscal. So that's where you will see some kind of numbers coming in days and after it gets commissioned over a period of next six to nine months, the plant will get stabilized and we'll see the numbers flowing in. So that's where we are in the previous year. So the plant is progressing well and on schedule.

Okay, so we have a certain, so to our understanding that we only have a plan for manufacturing the PVC, right? So, we, anything apart from, so is there anything else on the PVC line or it's just a PVC or anything else on the chloralkali?

So, yes, the chloralkali is also there. So, PVC and related chemicals in the material is out, around it.

Okay, okay, thank you. Thank you. Ladies and gentlemen, that was the last question. I now hand the conference over to the management for closing comments.

Thank you so much for all the questions, and we close this session. Thank you so much.

Thank you. On behalf of Adani Enterprises, this concludes the conference. Thank you for joining us, and even now disconnect your lines.