Is the Israel-Iran war a billion-dollar threat to Adani Ports & Sez?

Copyright © HT Digital Streams Limit all rights reserved. EquityMaster 5 min Read 19 Jun 2025, 01:11 PM IST If the Haifa port would suffer serious damage, the impact on Adani ports could be significant. (AFP) Summary Strategic Haifa port faces threat, as Adani ports fall for Israel-Iran conflict. The world is back on the edge. With the war in Ukraine still raging and simmering for the Middle East, a new conflict has plunged global geopolitics into deeper uncertainty. A few days ago, the tension between India and Pakistan flared up after 26 people died in a terror attack in Pahalgam. India launched Operation Sindor, which targeted terror camps across the control line. For a short moment, there was a serious anxiety that India and Pakistan could wage war. But both sides agreed to a ceasefire, which reduced tension. Also read: Is the premium of India at risk? While Israel-Iran conflict FPI outflow sparks, the valuation is raged in South Asia, but cool in South Asia was influenced by a more explosive conflict in the Middle East. On June 13, 2025, Israel launched a military campaign against Iran with major military and nuclear sites. Since then, the Israeli-Iran conflict has entered its fourth day, with no signs of unbundling. Overnight missile exchanges have tightened, with Iran beating an Israeli oil refinery and parts of its power grid. In this geopolitical storm, Adani Ports and Special Economic Zone (Apsez) Ltd. emerged as a company with a great interest in Dalal Street. Apsez is the largest commercial ports operator in India and is responsible for almost a fourth of the country’s cargo movement. It has a presence in 13 domestic ports in seven maritime states: Gujarat, Maharashtra, Goa, Kerala, Andhra Pradesh, Tamil Nadu and Odisha. By its subsidiary Adani Logistics, APSez operates three logistics parks in Patli in Haryana, Kila-Raipur in Punjab, and Kishangarh in Rajasthan. The company is working on the development, operation and maintenance of ports, the development of ports-related infrastructure and the development of infrastructure in special economic zones. On June 16, 2025, shares of Apsez were in focus amid the ongoing conflict between Israel and Iran. Some reports have suggested that the conflict between the two countries has damaged the Haifa port in Israel. Late Saturday night, the tension in the Middle East further escalated when Iran fired missiles at Israel’s Haifa harbor and an oil refinery in the area. The debris of the attack reportedly landed in the chemical terminal of the port, while other projectiles hit the oil refinery. Also read: Dull Summer casts a cloud on Voltas’s air conditioner volumes in the first quarter, while the incident immediately raises concerns, especially for Adani Group’s operations in the region, the reports of the Haifa harbor’s Adani industry do not affect. However, Jugeshinder Robbie Singh, the Adani group CFO, refuted the reports and said the damages are false. News agency on Sunday that the group’s port was not affected. Despite the tense situation, it is in the port of the port for now. According to the reports, eight ships remained and the handling of cargo continued smoothly. Operations have remained on track, without any damage to infrastructure or logistics. For the time being, Adani’s most important international port remains safe, even if the region is coming next. Adani Ports’ stake in the Haifa port in 2023 made the Adani group a high-profile international expansion by acquiring a 70% stake in Israel’s Haifa port for $ 1.2 billion, in partnership with Israel’s Gadot group, which owns the remaining 30%. The joint venture is focused on the strategic port up to 2054. Haifa serves as an important maritime gate for Israel, which handles more than 30% of the country’s imports. Although it contributes almost 5% to the revenue of APSez, it is less than 2% of the total cargo volume managed by the company. Apsez, which handles about 10.57 million tonnes of load in general, has always placed Haifa as a long-term strategic asset rather than a volume game. Look at the full image source: Adani Ports Annual Report FY25 The recent escalation in the Israel-Iran conflict has brought a shadow over the investment. The fear is that continuous hostilities may delay cargo movements at Haifa and disrupt the global shipping routes. The impact was already visible in the market on Friday. Shares of Adani Ports – One of the group’s most profitable businesses dropped more than 3% intraday to £ 1.396 before recovering slightly to £ 1,405.25, a 2.71% decline. Also read: Municipal bodies still avoid public mortgage problems. There are many who hold them back, while Haifa can represent a small part of the group’s activities, the geopolitical risk it now poses is now great. What if Adani’s Haifa port gets a hit? At present, Adani’s Haifa port is still underway, with cargo ships and the operations as usual. But there is a growing feeling of discomfort. What happens when things are worse? If the port would suffer serious damage, the impact on Adani ports could be significant. Early estimates indicate that losses could range between $ 1.9 billion and $ 2.9 billion. This includes the original $ 840 million (m) dumped in the transaction, about $ 50-100 m in annual turnover, and a potential hit of $ 1-2 billion in the market value. The longer the conflict continues, the more uncertain the returns on Adani’s overseas bet, which raises the question of whether this daring global expansion will produce long -term gains or become an expensive mistake. Vizhinjam Apsez’s scaling up will invest £ 13,000 crore to expand the Vizhinjam International Deepwater Seaport in Kerala’s Thiruvananthapuram. This next phase of growth, fully self -funded, is in the back of successful trials and growing demand. The port is already working with a capacity of 90%, after handling 280 ships and 620,000 TEUs since the trial operations began in June 2024. With an initial £ 7,000 crore already invested, the port expansion is aimed at keeping up with rising transition traffic and unlocking the full potential. 3x Global Operations by 2030 APSez looks on the overseas, and postponed daring plans to triple its international operations by 2029-30. With major investments in Israel, Tanzania and Sri Lanka, the company intends to handle 140-150 million tonnes (MMT) cargo worldwide by the end of the decade. Domestic volumes are also expected to grow gradually, with the capacity expected to reach 820-850 mmt. To stimulate this ambition, Apsez doubles on the most important global assets, including Israel’s Haifa port, the Tanzania Under-Construction Harbor, and Colombo West International Terminal in Sri Lanka. Look at the full image source: Adani Ports Annual Report FY25 Conclusion The Indian port industry will grow at 4-7% over the next five years, supported by rising imports, a drop in cargo costs and the normalization of global supply chains, according to a report by Motilal Oswal. Along with its expansion plans, Adani Ports will also benefit from the growth of the industry. But with the ongoing conflict in the Middle East and uncertainties around its Haifa harbor investment, all eyes are on the world’s global impact. It is important to do thorough research on finance and corporate governance before making investment decisions to ensure that it is in line with your financial goals and risk tolerance. Happy investment. Disclaimer: This article is for information purposes only. It is not a recommendation for stock and should not be treated as such. This article is syndicated from equitymaster.com. Catch all the business news, market news, news reports and latest news updates on Live Mint. 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