Tata, Adani and Other Giants to Invest $800B Collectively in Emerging Sectors

CIO Tech Outlook Team | Tuesday, 15 October 2024, 02:49 IST

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Indian conglomerates are gearing up for a massive investment surge, with capital commitments expected to soar to approximately $800 billion over the next decade, according to a report by S&P Global Ratings. This ambitious investment plan represents nearly triple the amount spent by major Indian business groups in the past ten years, marking a strategic shift towards aggressive growth and diversification.

Around 40% of these investments will be directed toward emerging sectors such as green hydrogen, clean energy, aviation, semiconductors, electric vehicles (EVs), and data centers. Leading the charge are conglomerates like Vedanta, Tata, Adani, Reliance, and JSW, which collectively plan to invest around $350 billion in these high-growth sectors over the next decade.

Neel Gopalakrishnan, credit analyst at S&P Global Ratings, highlighted the shift by stating, "Indian conglomerates will allocate approximately 40% of their spending to new businesses, including green hydrogen, clean energy, aviation, semiconductors, EVs, and data centers. The Vedanta, Tata, Adani, Reliance, and JSW groups alone plan to invest $350 billion in these sectors over the next decade."

These anticipated investments align with India’s broader goal to reduce its reliance on fossil fuels and transition toward cleaner energy. As the world’s third-largest carbon emitter, India needs an estimated $12.4 trillion in investments to meet its target of achieving net-zero emissions by 2070.

While some conglomerates are venturing into new business domains, others are expected to focus on scaling their existing operations. Groups like Birla, Mahindra, Hinduja, Hero, ITC, Bajaj, and Murugappa, known for their more conservative growth strategies, will continue investing primarily in their established business areas to enhance profitability and scale.

S&P Global Ratings projects that investments in these core businesses could range between $400 billion and $500 billion over the next ten years, assuming these companies maintain their current investment pace from the past two years.

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