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Let's dive into -

Aramco’s $1.5 bn deal with L&T & beyond
IREDA’s Rs 5,000 crore QIP
Why Adani Wilmar is no longer an Adani stock

Not investment advice

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Aramco 🤝L&T

L&T just bagged a $1.5 billion deal with Saudi Aramco.

Under this deal, L&T will handle engineering, procurement, and construction for Aramco’s Carbon Capture hub in Saudi Arabia. It's all part of Aramco’s plan to cut carbon emissions and boost its efforts to reach its climate goals.

But, Aramco’s growing love for Indian firms goes beyond just this contract. Let’s rewind a bit.

It was in 2016 when Aramco made its first official move — setting up Aramco India.

Fast forward a few years, and Aramco’s interest in India is growing rapidly. In February 2024, Faisal Faqeer, a senior Aramco executive, made it clear that they’ve got their sights set on India and are eager to invest. They were already talking to several Indian firms, teasing some big announcements soon.

The real kicker is Aramco’s venture arm, Prosperity7 Ventures.

They’re planning to set up shop in India and are actively hunting for early-stage investment opportunities. With a whopping $3 billion to play with globally, India is pegged as a key target for a chunk of that of around $300 mn

There’s more. In October 2023, India asked Aramco to join its 6.5 million metric ton oil reserve, aiming to boost energy ties with its key oil supplier.

It is also the world’s top oil exporter and has been investing more in refineries and petrochemicals across Asia to tap new markets for its oil. Chemicals are key to their plan to expand further downstream.

Downstream is basically, everything that happens after oil’s pulled out, like refining and selling products.

And that is why even Aramco India has been focusing on enhancing the efficiency of India's crude oil and liquified petroleum gas (LPG) supplies. It collaborates with local businesses and makes new partnerships to build a world-class competitive supply chain in this region.

With the history of collaborating with Indian firms like Indian Oil, and investing in Indian ventures, it seems like they see India as a big player in global energy and tech – and that's where they want to be.

IREDA’s big fundraise

So, the Indian Renewable Energy Development Agency (IREDA) just got the green light to raise a whopping Rs 5,000 crore by issuing equity shares through something called a Qualified Institutional Placement, or QIP.

But what exactly is a QIP?

Think of a QIP as a fast-track fundraising tool for companies looking to raise capital for their growth or business needs, where a company can raise money by issuing fresh equity shares to a select group of investors — mostly Qualified Institutional Buyers or QIBs.

So, who are these QIBs? They include public financial institutions, scheduled commercial banks, mutual funds, insurance companies, foreign portfolio investors — basically, big financial players who know their way around the market.

So, how does this whole QIP process work? Well, it kicks off with the company’s board giving the nod, then shareholders approving it, and finally, an investment banker is brought in to handle the logistics. A placement document is sent to the QIBs, they place their bids, a price is set, and shares are allocated to the buyers. All of this happens while following regulatory rules, and it can take several days to wrap everything up.

The big plus of a QIP is that it skips the long, complicated process of other modes of fundraising. Also, since QIBs are seasoned investors, they tend to have a long-term view, which helps keep the share price stable.

It's a great way for companies to raise money from the market, and it is preferred so much so that this way of fundraising hit a record high in 2024, crossing the Rs 1 lakh crore mark during the calendar year.

So, now for IREDA, which is all about financing renewable energy and energy efficiency projects, so raising this capital will not only boost green financing but also help the company grow its loan book and contribute to India’s clean energy goals.

Oh, and the government also plans to reduce its stake in IREDA by up to 7% after the equity issue.

Adani Wilmar’s rebranding

Adani Wilmar cannot be considered an "Adani stock" anymore.

Yep, you read that right.

But why? Well, the Adani Group recently sold its entire stake in Adani Wilmar to Wilmar International, marking the group's complete exit from the company. With this move, the control of Adani Wilmar now fully lies in the hands of Wilmar, who owns and manages the company.

How did it happen?

The story dates back to 1999 when Adani and Wilmar joined forces to create Adani Wilmar with an equal 50:50 partnership. Fast forward to February 2022, when Adani Wilmar went public, debuting on the stock market.

However, in December 2024, the Adani Group announced it was selling its entire 44% stake to Wilmar International. This transaction was completed when Wilmar's subsidiary, Lence Pte Ltd, bought all the shares owned by Adani Commodities LLP. As a result, Wilmar International, a Singapore-based company, now holds the majority of Adani Wilmar's shares.

But why did Adani Group exit? The reason is simple — the group decided to focus on its core infrastructure businesses. As part of this strategy, it chose to divest from non-core assets like Adani Wilmar, which operates in the fast-moving consumer goods (FMCG) sector.

And now in a further move to reflect its new direction — Adani Wilmar has officially rebranded to AWL Agri Business Limited after getting the green light from its shareholders for this name change.

So, this rebranding is a big move for the company, showing its new focus on the agriculture and food sectors. Adani Wilmar has been making its money from three key areas: edible oils (Fortune being its flagship brand), food and FMCG, and industry essentials.

So, the idea behind the rebranding is to better match the company’s identity with what it’s all about now and where it plans to grow in the agri-business space.

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