Shares of the Adani group of companies have recovered up to 95 per cent from their respective 52-week low levels amid the ongoing recovery in the domestic equity market. According to market watchers, an investment of Rs 15,446 crore by US boutique investment firm GQG Partners in four Adani firms namely Adani Ports and Special Economic Zone Ltd, Adani Green Energy Ltd, Adani Enterprises Ltd and Adani Transmission Ltd boosted sentiment.
With a rally of 95 per cent from its 52-week low of Rs 1017.10, Adani Enterprises emerged as the top gainer in the list. The scrip traded at Rs 1,982.85 on March 6. It was followed by Adani Ports and Special Economic Zone which has zoomed 75 per cent to Rs 690.50 from its 52-week low of Rs 394.95, scaled on February 3, 2023. Shares of Adani Green Energy, Adani Wilmar, Adani Total Gas, Adani Transmission and ACC have also gained somewhere between 12 per cent and 34 per cent from their respective 52-week low levels.
Sharing his views on the Adani group, Kranthi Bathini, Equity Strategist, WealthMills, said, “Investment by GQG definitely helped the Adani group shares in the recent past. Also, the management has lined up to meet various institutional investors in different geographies and markets are anticipating some more positive news flows.”
Vinit Bolinjkar, Head of Research, Ventura Securities, said, “Adani Enterprises can touch Rs 2,000 given the robust cash flow from the existing business. On the other hand, Adani Ports may rally up to 100 per cent in the next 2 years considering the present valuation and India’s export-import trade which is going to take off.”
Among the other major Adani stocks, NDTV, Adani Power and Ambuja Cements also traded 54 per cent, 54 per cent and 41 per cent higher against their respective 52-week high levels.
Is it time to enter the group’s stocks after the recent recovery? Bathini said, “It’s a matter of greed & fear, investors with high-risk appetite entered the stocks at bottom levels and have made some good returns in the last few days. However, one needs to be vigilant as these stocks are high beta stocks and are vulnerable to different kinds of news flows. Stocks in the medium term are voting machines and in the long run, they are weighing machines.”
Abhishek Agarwal, Managing Partner of Rockstud Capital, said: “There was an overreaction on Adani Group companies after the Hindenburg report. Adani’s success is not overnight. Leverage in debt or dilution of equity is the tool for funding the growth of the business. No default history, no corporate governance red flags from Sebi or similar governing agencies, and no real evidence to many claims of the report. Certainly, the report has caused massive financial and reputation damage to their stock and bonds. They are forced to early repayments of loans to avoid pledge revoke on their shares. The bounce back will happen surely, and the present turmoil is temporary.”
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