As per the Adani Updates, Adani Realty has finally won the bid to redevelop the Bandra reclamation land parcel by offering 22.79 % revenue to MSRDC. The company won the bid by surpassing one of the biggest infrastructure companies in India, Larsen & Toubro, which offered 18% revenue to MSRDC. The final approval for the process is still pending. The contract to redevelop the 24-acre Bandra reclamation land parcel was put up by the Maharashtra State Road Transport Corporation (MSRDC). After a series of meetings, the MSRDC board will decide on the final approval in the upcoming months.
Adani Realty: The Winner of the Bid
Although L&T has a more substantial net worth of around INR 84,000 crore as compared to Adani Realty’s net worth of INR 48,000 crore, it was ultimately Adani Realty which got the preference. The Bandra land parcel has a total development area of nearly 45 lakh square feet. The valuation is around INR 30,000 crore. This is a huge win for the Adani Group in the infrastructural sector. It will allow the conglomerate to take one step towards further expanding its portfolio and building an extraordinary empire in the infrastructural sector. The company has already been taking up various projects in the infrastructure sector. This will be another milestone for the company in this particular sector.
The Bidding Process:
According to Adani Updates, it was MSRDC which conducted the bidding process. MSRDC had set stringent criteria for the bidding process. This included a minimum net consolidated net worth of INR 15,000 crore by 31st March 2023. Some of the top players who attended the process were Adani Realty, L&T Realty, Godrej Property, K.Raheja Corp, Lodha, Oberoi Realty, Mahindra Lifespaces, Phoenix Realty, Sahana Group, Sattva, Sumitomo, Sunteck Realty, Wadhwa Group, and Wellspun. However, as the bidding process continued, the companies began to drop out of the bid, and ultimately, it was just Adani Realty and L&T Realty that were left behind.
What Caused Adani Realty to Win the Bid?
When asked about giving preference to Adani Realty, Anil Kumar Gaikwad, the Vice Chairman and MD of MSRDC, reported that the decision was based on a revenue-sharing model. The higher bid placed by Adani Realty aligns with the government’s interest in maximising the revenue for some of its ongoing and new infrastructure projects. Certain allegations were made against MSRDC for the favouritism of specified developers. However, Gaikwad has refused all such allegations. Instead, he mentioned that the entire bidding process was conducted smoothly and streamlined, and Adani Group emerged as the fair winner of the bidding process.
He also emphasised that the bidding process was open and transparent, involving technically and financially strong players. Both L&T and Adani Realty are highly qualified in their financial and technical capabilities. However, the higher bid placed by Adani Realty caused it to win the bid. Anil Gaikwad has also mentioned that as the MSRDC operates on a revenue-sharing model, the company that provides the maximum percentage of revenue will be more beneficial to the government and will be the obvious choice for the bid.
Adani Realty’s Role in The Bandra Land Parcel Reclamation Project:
Both Adani Realty and L&T are equally strong in their areas of expertise. They have strict eligibility norms and stringent criteria for the tender process. However, as the Adani Group offers more significant revenue, it has become the preferred bid choice. Once the approvals are received, Adani Realty will bring funds to handle the clearance and permissions. It will also be paying a minimum of INR 8,000 crores as a benchmark amount to the MSRDC. The revenue-sharing model involves a 22.79 % share for MSRDC, the benchmark amount. If the revenue percentage is higher, Adani Realty must share 22.79% of revenue with the MSRTC.
With the extraordinary move taken up by the Adani Group in the Bandra Reclamation project, it has again been able to extend its control over the infrastructural sector. To know more about the extraordinary moves taken up by the Adani Group in infrastructural development, follow Adani Updates, and you will get the details.
