Adani Total Gas Ltd

Your group will continue to consolidate what it has built while looking at expanding its horizons.

Dear Shareholders,

A few months back I heard a new term, Permacrisis. I learnt that the Collins dictionary had defined it as "an extended period of instability and insecurity". They also chose it as the word for the year 2022. Interestingly, I also learnt that two other words that were in the running for the top spot were "quiet quitting" which meant doing the bare minimum duties at work (in rejection of competitive careerism) and "vibe shift" which meant a significant change in the prevailing culture. What I find fascinating is that, in the post Covid world. These words accurately summarize changes we see happening all around us.

There can be no denying that the world is continuing to be hit by multiple shocks, be it the climate emergency, geopolitical disequilibrium, supply chain and energy volatility, or persistent inflation. What does make the situation a permacrisis is the fact that we have never had a time wherein all these events were happening simultaneously and without a clear solution in sight. Add to this the opportunities and challenges because of the technological revolution, especially the breathtaking advances in artificial intelligence, and what we have is a massive potential reset in the existing global operating models. The future of work. The future of learning. The future of medicine, and in some ways. The future of economic growth itself will need to be reset. Therefore, as we end one financial cycle and begin another, it is important to take a step back and assess the global economic situation and India's position as part of this landscape.

While economic cycles are getting increasingly hard to forecast. There is little doubt that, India, already the world's 5th largest economy, will become the world's 3rd largest economy well before 2030 and. Thereafter. The world's 2nd largest economy by 2050.

It is well understood that for any economy to lay the foundation of growth, a stable Government is critical, and we have seen this impact with the implementation of several structural reforms that are critical for strong, sustainable, and balanced growth. This stability coupled with India's young demographics and continued expansion of internal demand is a potent combination.

Our nation's demographic dividend is expected to drive consumption and accelerate the growth of a tax paying society at record pace over the next three decades. The United Nations Population Fund (UNFPA) projects that India's median age will be just 38 years even in 2050. Over this period, India's population is expected to grow by approximately 15% to 1.6 billion, but the per capita income will accelerate by over 700% to about 16,000 US dollars. On a purchasing power parity basis, this per capita metric will be 3 to 4 times higher. The growth of this consuming middle class is expected to insulate us to quite some extent from global recessions as our growth is primarily driven by domestic demand. This, in turn, should drive a logical surge in private and government expenditures as well as attract more and more foreign direct investments.

And we have the statistics to prove it. Following our independence, it took us 58 years to get to our first trillion dollars of GDP, 12 years to get to the next trillion and just 5 years for the third trillion. I anticipate that within the next decade, India will start adding a trillion dollars to its GDP every 18 months - thereby putting us well on track to be a 25 to 30 trillion-dollar economy by 2050. This will potentially drive India's total market capitalization to over 40 trillion dollars, which is, approximately a10X expansion from current levels.

I would urge you to reflect on these incredible possibilities ahead. India's success story of balancing economic growth and a vibrant democratic society has no parallel. My belief in the India growth story has never been higher.

Let me now address the shortselling issue that impacted Adani Group this year. On the eve of our Republic Day, a US- based short-seller published a report just as Adani Group was planning to launch the largest Follow-on Public Offering (FPO) in India's history. The report was a combination of targeted misinformation and outdated, discredited allegations aimed at damaging Adani Group s' reputation and generating profits through a deliberate drive-down of Adani Group stock prices.

Subsequently, despite a fully subscribed FPO, Adani Group decided to withdraw and return the money to investors to protect their interests. The short-selling incident resulted in several adverse consequences thatAdani Group had to confront. Even though Adani Group promptly issued a comprehensive rebuttal, various vested interests tried to opportunistically exploit the claims made by the short seller. These entities engaged and encouraged false narratives across various news and social media platforms. Consequently. The Hon'ble Supreme Court of India constituted an Expert Committee to look into this matter. It comprised individuals known for their independence and integrity. The report of the Expert Committee was made public in May 2023.

The Expert Committee did not find any regulatory failure. The Committee's Report not only observed that the mitigating measures, undertaken by Adani Group helped rebuild confidence but also cited that there were credible charges of concerted destabilization of the Indian markets. It also confirmed the quality of Adani Group's disclosures and found no instance of regulatory failure or any breach. While the SEBI is still to submit its report in the months ahead, Adani Group remains confident of its governance and disclosure standards.

Since the announcement of Joint-Venture partnership between Adani Group and TotalEnergies, Adani Total Gas Limited (ATGL) has grown from strength to strength. The partnership is deriving significant synergies between Adani Group's capabilities of developing world-class assets and TotalEnergies's global best practices & LNG knowhow, supplementing in institutionalizing ATGL to be resilient and emerge stronger to overcome any challenges and be ahead of the curve. I am delighted that ATGL, being one of the largest CGD companies in India, has continued its focus on accelerating CGD infrastructure growth across India and consumer centricity approach now expanding its horizons to e-mobility and biomass businesses to provide choice of fuels to the consumers.

Over the past three decades, I have learnt that growth comes with its set of challenges. Every challenge Adani Group has faced has made it more resilient. And this resilience is vindicated by the outcomes Adani Group delivers.

FY22-23 operational and financial results are as much a testimony to Adani Group success as testimony to Adani Group continued expansion of our customer base - be it on the B2B side or the B2C side. Adani Group s' balance sheet, its assets, and its operating cashflows continue to get stronger and are now healthier than ever before. The pace at which Adani Group has made acquisitions and turned them around is unmatched across the national landscape and has fuelled a significant part of expansion. Adani Group s' national and international partnerships are proof of its governance standards. This scale of international expansions is validated by success in Australia, Israel, Bangladesh, and Sri Lanka.

Adani Group is now constituted of 10 publicly traded entities, each with its own set of several successes, I have listed below some of the key highlights across the various businesses.

1. The Adani Group of companies set new financial performance records with a. total EBITDA grew by 36% to INR 57,219 crores, b. total income grew by 96% to INR 1,38,715 crores, and

c. total PAT grew by 218% to INR 2,473 crores.

2. The Group's deleveraging program of USD 2.65 Bn for the Adani portfolio companies was completed successfully and further improved our net Debt to run rate EBIDTA ratio from 3.2x to 2.8x in FY2023.

3. Adani Group's flagship company, Adani Enterprise Limited (AEL) continued to successfully demonstrate its incubation capabilities with new businesses accounting for 50% of its EBITDA in FY23.

a. Of the several projects underway, two of the key ones include the Navi Mumbai Airport and the Copper Smelter. Both are on schedule.

b. The Integrated Resource Management (IRM) volume increased by 37% to 88.2 MMT vs 64.4 MMT in FY 2021-22

c. In the area of the media business, AEL acquired New Delhi Television Ltd (NDTV), and 49% stake in Quintillion Business Media Limited.

4. Adani Group is set to play a critical role in India's Net Zero journey. The renewable energy business, Adani Green Energy Limited, commissioned the world's largest hybrid solar-wind project of 2.14 GW in Rajasthan and the operational renewable energy portfolio grew by 49% to over 8 GW. The largest operational renewable portfolio in India.

5. The backward integration plans in the renewable energy value chain progressed as planned.

a. A new solar module line plant of 2 GW was operationalized and

b. The existing 1.5 GW module line was upgraded to 2.0 GW using TOPCON Cell Technology.

6. The ports business continued to be the pillar of strength on all fronts. APSEZ continues to be amongst the most profitable port operators globally with port EBITDA margin of 70%.

7. Adani Power Ltd. successfully commissioned the 1.6 GW Ultra-super critical Godda power plant and is now supplying power to Bangladesh. This marks Adani Group'sentry into the transnational power projects.

8. The transmission and distribution businesses set new benchmarks. Mumbai distribution business achieved reliability of 99.99% and was ranked the number 1 discom by the Union Ministry of Power.

9. Adani Total Gas Ltd, Adani Group's JV with TotalEnergies expanded access to clean cooking fuel to 124,000 households this year with 46% increase in revenue to INR 4,683 Crore and is transforming into a full spectrum sustainable energy provider with foray into e-mobility and biomass businesses.

10. Lastly, on partnership front, Adani Group continues to attract global investment partners aligned to its longterm approach of building and operating world-class assets. In March 2023, Adani Group successfully executed a secondary transaction with GQG partners of USD1.87 billion despite the volatile market conditions.

The India in which we live today is the most exciting land of opportunities with blossoming entrepreneurial spirit. Every day is a beginning of something new, innovative, and transformative. Adani Group has always believed in growth with goodness philosophy and track record speaks for itself. Adani group will continue to consolidate what it has built while looking at expanding its horizons. Adani Group's consumers, investors, shareholders and results speak for themselves. On behalf of your Company, I will reaffirm and assure you that we are committed to the highest levels of governance and regulatory compliance.

In closing, let me emphasize how grateful I am for all your support.

It has been the greatest source of my strength and it is my promise to you that I will do my utmost to uphold the trust you put in me and my team.

Thank you.

Gautam Adani.