For a few Adani Group companies, a 106-page report written by US-based short seller Hindenburg Research is officially history since three of ten listed stocks have advanced profitably over the last 12 months while experiencing extreme volatility. The overall market capitalization of the group has lately hovered around Rs 14.5 lakh crore, having fallen as low as Rs 6.81 lakh crore following the revelation. When Hindenburg's report was made public on January 24, 2023, the amount was Rs 19.19 lakh crore.
According to data, Adani Power's shares have increased by 89% during the last year, ending on January 24, 2024. During the same period, Adani Ports and Special Economic Zone and Ambuja Cements had gains of 47% and 6%, respectively. With a target price of Rs 1,410, brokerage Motilal Oswal Financial Services is optimistic on Adani Ports (APSEZ). On January 29, in the afternoon trade, the company's shares were trading at Rs 1,188.
"By 2030, APSEZ hopes to be the biggest private port company in the world and the largest integrated transport utility in India. With a varied cargo mix, APSEZ aims to raise the cargo share of east coast ports. Over FY23–26, it is anticipated that the operational ramp-up at the recently acquired ports will propel a 14% increase in cargo volumes. Over FY23–26, this would result in a revenue/EBITDA/PAT CAGR of 19%, 18%, and 17%, according to a report by Motilal Oswal Financial Services.
However, other group stocks have surged between 22 and 275% from their respective 52-week levels. These stocks include Adani Green Energy, Adani Enterprises, Adani Total Gas, Adani Energy Solutions, New Delhi Television, ACC, and Adani Wilmar. These stocks, nevertheless, are still headed towards the levels they were on January 24, 2023. On January 28, the international financial services company Cantor Fitzgerald began covering Adani Enterprises, citing a 44% upside from the current market price of Rs 3033 at a target price of Rs 4,368. Just prior to the release of the Hindenburg Research study last year, the company's shares traded for Rs 3,442.
According to Cantor Fitzgerald, Adani Enterprises (AEL) is the driving force behind all of India's ambitions. "AEL is the most dependable firm in India for supplying energy resources; it controls eight airports, which together carry 33% of all cargo and around 25% of all airline passenger traffic. In addition, it has contracts to develop over 5,000 km of highways, construct many data centers around the nation, and is a key supplier of solar and wind power technology to support India's aspirations for renewable energy, according to a research from Cantor Fitzgerald.
Current shareholding data also demonstrated the optimism of local investors towards Adani Group. As an example, mutual funds increased their investment in Adani Enterprises from 1.19 percent in December 2022 to 1.49 percent as of December 31, 2023. During the same time frame, they increased their ownership in ACC, Adani Energy Solutions, Adani Green, Adani Power, and Adani Wilmar. Conversely, retail investors increased their holdings in Adani Wilmar, Ambuja Cements, Adani Total Gas, Adani Enterprises, Adani Green Energy, Adani Ports and Special Economic Zone, and ACC.
Following the Q3 results, Brokerage Antique Stock Broking kept a "Buy" call on ACC. Higher volumes and lower costs drove ACC's Q3FY24 EBITDA, which surprised pleasantly, jumping 65% QoQ to Rs 900 crore, 20%–30% over our/consensus projections. In order to account for increased profitability, we lift our target multiple to 11x (10x before) and boost our FY24–FY26 EBITDA estimates by 6–10%. The goal price was changed from Rs 2,550 to Rs 3,000. At about 9x FY26E EV/EBITDA, valuations are still appealing, the brokerage stated in a research.
