Adani Group stocks rise 4% on first day of new year; what’s driving the rally?
- Among the Nifty 50 stocks, Adani Enterprises and Adani Ports & Special Economic Zone emerge as the top gainers, registering an impressive surge of over 2.5 per cent.
Adani Group's stock experienced a notable surge of up to 4 per cent on January 1, contrasting with the lacklustre performance of the benchmark Nifty and Sensex as they commenced the new year. Among the Nifty 50 stocks, Adani Enterprises and Adani Ports & Special Economic Zone emerged as the top gainers, registering an impressive surge of over 2.5 per cent.
Adani Enterprises witnessed a robust 3 per cent climb, while Adani Power and Adani Green Energy posted gains of 0.8 per cent and 0.75 per cent, respectively. Adani Energy Solution and Adani Total Gas each gained 1 per cent, and Adani Wilmar witnessed a substantial surge of 4 per cent. Additionally, NDTV, Ambuja Cement, and ACC stocks also displayed positive momentum. Despite this, the NSE Nifty 50 traded flat at 21,732 intraday on January 1.
Ahead of a board meeting on January 3, Adani Ports stock surged nearly 3 per cent. The meeting is scheduled to deliberate and approve a proposal concerning the issuance of non-convertible debentures through a public offering, preferential allotment, or a combination of both.
Gautam Adani, previously the world's second-richest individual at the outset of 2023, witnessed a substantial erosion of almost $60 billion in wealth. This decline ensued after Hindenburg Research, based in the US, published a report on January 24, 2023, accusing the Adani Group of market manipulation and accounting fraud.
In response to the report, the conglomerate's stocks plummeted by up to 75 per cent within a span of less than two months. Despite this downturn, the combined market capitalisation of Gautam Adani's listed empire exceeded ₹14.22 lakh crore on Monday, representing a nearly 25 per cent deficit compared to the market capitalisation of ₹19.19 lakh crore recorded on January 24.
The conglomerate successfully secured over $5 billion in equity and a double amount in debt during the year 2023, as reported by PTI. GQG Partners, led by Rajiv Jain, acquired stakes worth nearly $4.3 billion in five group companies between March and August. Additionally, Qatar Investment Authority (QIA) and the renowned French energy company TotalEnergies invested $770 million in Adani Green Energy, based on company filings and stock exchange data.
Furthermore, the promoters injected $4.6 billion into various initiatives, including repaying loans against shares, servicing loans taken for cement acquisitions, and supporting environmentally friendly investments. This strategic move significantly enhanced investor confidence. The surge in Adani Group stocks propelled Gautam Adani's wealth to $84.3 billion, as per the Bloomberg Billionaires Index.
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The Adani Group is strategically envisioning a substantial capital expenditure of ₹7 lakh crore over the next decade to augment its infrastructure business, as outlined in a recent investor presentation by the company's management. Adani Enterprises' subsidiary, Adani Global, Mauritius, has recently entered into a 49:51 joint venture (JV) with Sirius International Holding based in the UAE, situated in Abu Dhabi. This collaboration aims to leverage cutting-edge technologies such as artificial intelligence (AI), internet of things (IoT), and secure blockchain products for industrial applications.
“Sirius JV will capitalise on the global digital transformation expertise of Sirius and Adani's strategic insights to focus on leading the $175-billion opportunity in digitalisation of the Indian economy. This digital opportunity is rapidly evolving to becoming a $1 trillion market by 2030,” Adani Enterprises said in a regulatory filing.
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