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India’s Adani Group is in talks to expand into e-commerce and payments, according to four people familiar with the matter, as the conglomerate builds a digital business to compete with the likes of Google and Mukesh Ambani’s Reliance Industries in ‘s the world’s most populous country.
The plans come as the group’s politically well-connected founder Gautam Adani tries to put damaging scandals behind him and diversify his empire into fast-growing, consumer-oriented markets. Adani has become Asia’s second-richest man by amassing an extensive infrastructure and logistics network of ports, airports and energy.
The company is now considering applying for a license to operate on India’s ubiquitous public digital payments network, the Unified Payments Interface, and is in talks with banks to finalize previously announced plans for a co-branded Adani credit card, according to the people.
In addition, negotiations are underway to offer online shopping through India’s fast-growing government-backed public e-commerce platform, the Open Network for Digital Commerce, she added. ONDC and UPI are part of India’s digital public infrastructure “stack,” which attracts hundreds of millions of users every month and has become popular with groups competing to build consumer tech companies.
“There are only three business conglomerates running this country – the Tatas, the Ambanis and the Adanis,” says Jayanth Kolla, a Bengaluru-based technology analyst. “Adani is one of the three groups that does not have significant consumer-facing activities.”
Once completed, the services will be available through Adani’s consumer app Adani One, which will launch in late 2022 and offer travel services such as flight and hotel bookings.
Google and Walmart-backed PhonePe already operates widely used UPI-based payment apps, while domestic groups like Paytm and Tata offer groceries and fashion retail through ONDC. The ‘interoperable’ networks ensure that companies do not have to invest in their own payment or e-commerce platforms, because they can transact through other providers.
Adani’s consumer action comes after a scandal last year in which American short seller Hindenburg Research accused the company of market manipulation and fraud. The allegations led to a $150 billion plunge in Adani’s listed shares and attacks from opposition leaders over the founder’s long ties with Prime Minister Narendra Modi.
The company has remained in the spotlight amid the ongoing elections in India. The opposition has vowed to investigate Adani if he is elected following a Financial Times report last week that the country had portrayed low-quality coal as a more expensive, cleaner fuel when selling to a state-owned company. Modi has also accused his rivals of taking ‘black money’ from Adani.
The group denies wrongdoing and India’s securities regulator has not yet released the outcome of an investigation into Hindenburg’s allegations. Meanwhile, Adani companies have recovered, with shares of flagship Adani Enterprises recovering almost all of last year’s losses.
On Tuesday, the board of the conglomerate’s flagship Adani Enterprises approved plans to raise up to Rs166 billion ($2 billion) through a share sale, after the group’s power transmission company Adani Energy Solutions gave the nod for a share issue earlier this week worth $1.5 billion.
The fundraising plans come more than a year after Adani Enterprises withheld a $2.5 billion share placement as Hindenburg’s allegations sparked a collapse in share prices at the group’s listed companies.
Adani’s consumer push comes as it seeks to expand and integrate disparate parts of its business empire, such as NDTV, a broadcaster acquired in 2022, and the Adani Wilmar joint venture that sells food products such as rice and wheat. It also plans to establish a think tank focusing on climate change, energy and politics.
People familiar with the matter said the company’s e-commerce and payments offering would initially target existing users of its businesses, which they said would cover hundreds of millions of people, including gas and electricity customers and travelers on the airports.
For example, they could acquire loyalty points through bill payments or tax-free purchases and use them for online shopping, the people said. Targeting existing users in this way would give Adani “a platform to go into much bigger areas,” one of the people said. Another added that Adani was planning to add NDTV content to its app this year.
Analysts are skeptical about Adani’s prospects. Tata’s so-called super app Tata Neu, launched in 2022, has gained limited traction, while Reliance has a years-long lead in consumer businesses such as telecom, retail and entertainment.
“You pay your bills once, you travel once or twice, that’s it,” says Satish Meena, an independent analyst. “These points are not a motivation for a customer to switch to online shopping at Adani.”
Adani declined to comment.
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