Top Banks Line Up for Project Loan Participation in Adani Enterprises’ PVC Venture
Leading banks in India, including SBI and ICICI, are participating in a Rs 20,000-crore project loan for Adani Enterprises’ new PVC plant in Gujarat. The downsell strategy by SBI will reduce its exposure while boosting India’s PVC production capacity, meeting the growing domestic demand for this vital petrochemical.
Top Banks Line Up for Project Loan Participation in Adani Enterprises’ PVC Venture
Leading public and private sector banks in India are showing interest in joining a greenfield project finance loan led by the State Bank of India (SBI) for Adani Enterprises. SBI had earlier approved a substantial Rs 20,000-crore credit line for Adani’s petrochemical debut, specifically a polyvinyl chloride (PVC) plant at Mundra, Gujarat. This $4-billion project has attracted participation from banks such as Bank of Baroda, Punjab National Bank, Union Bank of India, Central Bank of India, ICICI Bank, and Axis Bank, each either committing funds or in the process of doing so, sources familiar with the matter reported.
The project’s 15-year loan, originally priced by SBI at 9.25%, represents Adani’s first major venture into the petrochemical sector and aims to significantly boost India's PVC production capacity. The Mundra facility, with a targeted output of 2 million tonnes, is set to help meet India’s growing demand for PVC—a key material used in rainwear, cables, piping, and medical equipment—while also reducing dependency on imports.
SBI Strategy and Loan Distribution Plan
Initially, SBI acted as the sole underwriter for the loan and has already disbursed a few hundred crores. To manage its exposure, SBI now plans to down-sell a portion of the loan to other banks while retaining a share of Rs 5,000-7,000 crore. The loan downsell strategy enables SBI to mitigate its risk exposure and allows more group limits for other lending opportunities. The PVC project’s attractive credit rating, along with Adani Group's financial standing, has prompted other banks to partake in the loan, with smaller banks expected to each take on between Rs 1,000 crore and Rs 2,000 crore.
According to sources, the final securitisation documentation is being drafted, allowing individual banks to proceed based on internal approvals. Once completed, SBI will release its share, allowing Adani Group to draw from participating banks as needed for project financing. Bank officials expect this process to conclude within a month.
The PVC plant’s initial phase is projected to be operational by late 2026, providing essential materials to meet domestic demand amid rising infrastructure investments in India.
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