According to Adani Airports Holding Ltd (AAHL) CEO Arun Bansal, Adani Group is working on a comprehensive strategy to reduce regulatory charges to a bare minimum by enhancing non-aeronautical revenue and city-side development. Speaking at the 13th SBI Banking and Economics Conclave 2026, Bansal explained that while aeronautical charges are fees levied on airlines and passengers for core airport infrastructure, non-aeronautical charges from retail, leasing and services represent two-thirds of the business. The company's ambition is to bring down regulatory revenue profile to almost single digits over time, fundamentally transforming the revenue mix from regulated to commercial operations. This strategic pivot aligns with Jefferies' assessment that the airports business is approaching a multi-year earnings acceleration phase driven by strategic developments.
As reported by Bansal, Navi Mumbai International Airport has been planned, dimensioned and constructed with the ambition to become an international hub when an Indian carrier starts direct flights to the US or Europe. The airport is prepared and built with that ambition that it can be one of the international hubs for India. Bansal noted that India needs a national carrier first to make the country a global hub for international traffic, citing Singapore, Dubai and Qatar as examples of global hubs that became successful because they have strong international terminals. He highlighted that IndiGo and Air India have 1,800 aircraft on order, once those aircraft get delivered by 2032, India has potential to become that hub. The West Asia crisis has opened regulators' eyes to India's dependence on transit hubs for European and US travel, creating momentum for regulatory framework changes to make India the global hub.
As reported by Jefferies, city-side development has emerged as a major value driver for Adani Enterprises. Management plans to invest approximately ₹20,000 crore in city-side projects as part of a broader ₹1 lakh crore airport capital expenditure programme. The projects focus on convention centres, hospitality, retail and commercial assets, allowing the company to capture development profits and recurring income streams. This strategic approach aligns with the company's incubation-to-value-unlocking model, where businesses are scaled through investment and later carved out into separate listed entities. According to Jefferies, airports could be among the first platforms to be carved out into a separate listed entity as they mature, representing a key value creation opportunity for the company. The model is particularly relevant because it allows the stock to be valued as a pipeline of businesses at different stages of maturity, rather than a single operating profit stream.
According to Jefferies, artificial intelligence is accelerating the data-centre opportunity for Adani Connex, which currently has about 960 MW of contracted capacity and is targeting approximately 3 GW by 2031. The structural piece of the data centre business is particularly compelling, with the data centre business estimated to contribute about 20% of sales by FY29 against about 10% in FY27. At 47 times one-year forward earnings, 7% above its five-year average, the valuation already reflects a good deal of that growth potential. Management's argument is that AI workloads are expanding the addressable opportunity rather than simply adding to it, as AI training and inference are far more power-dense than conventional cloud hosting, which favours operators that control power supply and land alongside the racks. Recent capital raises have left the company well positioned to fund its next growth phase, with balance sheet capacity being the constraint that decides how many businesses can be built simultaneously.
According to Bansal, Adani Group-operated Mumbai airport will start demolishing part of Terminal 1 from January 15, 2027, with the company having started redistributing air traffic to Terminal 2 and Navi Mumbai airport. He emphasized that airlines have been given time to plan their operations and that around five million passenger capacity from T1 will need to be accommodated elsewhere as the redevelopment progresses. However, Bansal clarified that airport operators can't force any airline to shift operations, stating that "We can never force any airline to operate from Navi Mumbai or Mumbai or Ahmedabad. It's their choice." Regarding potential airline business ventures, Bansal said he would not compete with customers, focusing instead on airport development both domestically and internationally, noting that his hands are full building capacity from 100 million to 500 million passengers in the next decade.
