Adani Group stocks surged sharply, with most hitting their respective 52-week highs on Monday following the overall positive sentiment of the Indian markets after exit polls indicated a resounding victory for Prime Minister Narendra Modi-led government for the third consecutive time with a comfortable majority. Apart from this, Jefferies' bullish outlook on the Adani Group stocks, in a recent report also aided the sentiment.
In intra-day deals, Adani Power rallied as much as 18.5 percent to its 52-week high of ₹896.75. It ended 15.64 percent higher at ₹875. It was followed by Adani Green Energy, which soared 13.5 percent to its year-high of ₹2,173.65. The green energy stock settled 6.39 percent higher at ₹2,037.65.
Meanwhile, Adani Ports surged 11.8 percent to ₹1607.95 in intra-day deals, also its 52-week high. It closed 10.25 percent higher at ₹1,585. Also, Adani Energy Solutions hit its year-high of ₹3,743, up 9.7 percent in intra-day deals but ended 6.86 percent higher at ₹3,645.35. Whereas, Adani Enterprises soared 9.7 percent to its 52-week high of ₹3,743 and settled 6.8 percent higher at ₹3,645.35.
Among other stocks that did not hit their 52-week highs, Adani Total Gas also rose 15.3 percent to ₹1197.95. It had hit its 52-week high of ₹1,259.90 last year on October 26, 2023. The stock jumped 7.77 percent to end at ₹1,119.85. Adani Wilmar also advanced 7.3 percent to ₹382 but settled 3.5 percent higher at ₹368.35. It had also hit its year high of ₹446.30 last year on June 2, 2023
Furthermore, ACC, Ambuja Cements and NDTV also ended between 5.5-7 percent higher in today's deals.
Read here: Indian Stock Market: Exit polls sentimental positive for capex stocks: Jefferies
The combined market capitalisation of all 10 listed Adani stocks also surged by nearly ₹1.6 lakh crore, bringing the total market value of the conglomerate's listed entities to ₹19.42 lakh crore at close. In intra-day deals, the m-cap of all Adani Group firms crossed ₹20 lakh crore for the first time ever. The m-cap at today's close is higher than Adani Group firms' total m-cap of ₹19.20 lakh crore at close on January 24, 2023, when Hindenburg's report was made public.
Apart from strong exit polls indicating a likely uninterrupted win for the Modi government, a recent Jefferies report highlighted that the Adani Group has rebounded from the losses incurred during the Hindenburg episode and is now on an "expansion spree," planning a $90 billion capital expenditure over the next decade.
In January of the previous year, U.S. short-seller Hindenburg released a critical report on the Adani Group, alleging accounting fraud, stock price manipulation, and improper use of tax havens. The Adani Group has consistently denied all these allegations since the controversy began. Despite the denials, the stocks were significantly impacted as investor concerns grew.
Read here: Nifty 50, Sensex hit record highs after exit polls predict BJP-led NDA win
During the financial year 2023–24, the Adani Group focused on reducing its debt and the founders' share pledge, according to a Jefferies report. Its profit after tax (PAT) in FY24 jumped 55 percent to ₹30,768 crore, it further informed.
The report also highlighted that the Net debt at the group level remained stable at ₹2.2 lakh crore in 2023–24, compared to ₹2.3 lakh crore the previous year.
The brokerage has given a 'buy' rating to three group stocks: Adani Enterprises (target price: ₹3,800), Adani Ports (target price: ₹1,640), and Adani Energy Solutions (target price: ₹1,365).
Read here: Dharmesh Shah recommends these two stocks to buy today
Adani Enterprises is scaling its manufacturing capacity towards starting green hydrogen production by 2026–27, and the Navi Mumbai Airport is expected to be commissioned by the fourth quarter of FY 2024–25. Adani Ports' performance has been boosted by the new dedicated freight corridor at Mundra, with significant logistics potential driving growth, it said.
For Adani Energy Solutions, the brokerage highlighted strategic debt management, noting efforts to refinance debt at fixed rates aligned with the asset's life.
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.
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Published: 03 Jun 2024, 10:31 AM IST
