Why Adani stocks are showing mixed trend on Tuesday?
4 min read . Updated: 07 Feb 2023, 10:42 AM IST
Premium- The crisis in Gautam Adani's conglomerate which is battling allegations of stock manipulation and frauds, has spilled over into street protests and flared financial contagion.
A mixed trend is seen in Adani Group's stocks on Tuesday with the majority of them rising while some continuing to extend their lower circuit levels. Third-quarter numbers of FY23 have come into focus. The crisis in Gautam Adani's conglomerate which is battling allegations of stock manipulation and frauds, has spilled over into street protests and flared financial contagion.
Adani Power and Adani Total Gas hit back-to-back lower circuits, while the conglomerate's FMCG player Adani Wilmar traced both circuits. Adani Green saw seesaw performance. Flagship firm Adani Enterprises along with Adani Ports and Adani Transmission gained.
Bulls on Adani stocks:
Group's flagship company, Adani Enterprises' share price was trading at ₹1,617.95 apiece up by ₹45.55 or 2.90% on BSE, at the time of writing. The stock gained by over 5% in the early deals with an intraday high of ₹1,655.35 apiece. Currently, its market cap is over ₹1.86 lakh crore.
Adani Ports and Special Economic Zone (ASPEZ) is trading near its day's high of ₹567.50 apiece. Currently, the stock is up by 3.65% to trade at ₹566 apiece on BSE. Its market cap is over ₹1.22 lakh crore. This stock is up for the third day in a row!
FMCG firm, Adani Wilmar witnessed a mixed sentiment. In the early deals, the stock touched a 5% lower circuit of ₹361.40 apiece on BSE. But soon after the stock lobbed high to trade at a 5% upper circuit of ₹399.40 apiece on BSE. Its market cap is around ₹51,909 crore. This would be the first upside after eight consecutive days of a selloff in Adani Wilmar. Between January 25 to February 6th, Adani Wilmar's stock hit back-to-back lower circuits.
Similarly, Adani Green's share price which touched a lower circuit of ₹843.20 apiece in early deals on Tuesday, currently is trading at ₹896.15 apiece up by nearly a percent. Its market cap is over ₹1.43 lakh crore. The stock has been in red from February 1st to 6th.
Adani Transmission's share price froze at 5% upper circuit at ₹1,324.45 apiece on BSE after its strong growth in the third quarter of FY23. Its market cap is over ₹1.47 lakh crore currently. The stock is up on Tuesday after four days of straight selling pressure.
Bears on Adani stocks:
Adani Power continued to bleed for nine straight days by touching back-to-back lower circuits. On Tuesday, the stock hit its 5% lower circuit once again to trade at ₹173.35 apiece on BSE.
Just like Adani Power, Adani Total Gas also traded at its 5% lower circuit to ₹1,467.50 apiece on BSE. Its market cap is over ₹1.61 lakh crore. This stock is in red for 11 days in a row.
Why the mixed trend in Adani stocks?
One of the major driving factors in Adani shares could be promoters prepaying $1.114 billion ahead of its maturity of September 2024. Following this, Adani will release equity shares in three of its firms in due course.
Among the companies of which the group will release shares are -- 168.27 million shares representing 12% of the promoters holding in Adani Ports; 27.56 shares representing 3% of promoters holding in Adani Green; and 11.77 million shares representing 1.4% of promoters holding in Adani Transmission.
Also, Adani Ports shares are up after the company announced its operational performance for January 2023 last week. In the month under review, ts operational performance for January 2023 was last week.
Another reason for the upside could be the onset of Q3 earnings of the group's companies with Adani Transmission being the latest one to present its financial results.
In Q3FY23, Adani Transmission saw a 77.8% YoY rise in net profit to ₹474.7 crore, while revenue increased by 22% YoY to ₹3,551.7 crore. EBITDA soared by 64% YoY to ₹1,477.5 crore.
Adani Green Energy, Adani Ports, and Ambuja Cements stock will be in focus on Tuesday ahead of their December 2022 quarterly earnings scheduled on this day.
While Adani Power will announce its Q3 figures on Wednesday.
Adani stocks are in a free fall since January 24, after a US-based short-seller Hindenburg Research accused the conglomerate of stock manipulation, tax evasion, and fraud schemes among others. Also, concerns over Adani's funds' requirement for expansion plans and meeting debt services escalated after it withdrew its ₹20,000 crore follow-on public offer. These factors triggered a market rout, and by end of February 6th, the cumulative losses topped $110 billion.
The crisis sweeping over Adani Group escalated to the point India's opposition parties took to the streets to press for a probe into allegations by Hindenburg.
As per a Reuters report on Monday, opposition parties, who last week called for a parliamentary panel to investigate the saga and disrupted proceedings, have questioned Indian Prime Minister Narendra Modi's closeness with Adani.
