It's a windfall for the investors of Adani Group stocks. Three of the six listed entities of the Group have fetched returns in excess of 80 per cent year-to-date, while two have yielded nearly 50 per cent and one gave a little over 10 per cent in the past 43 trading sessions or since January 1, 2021.
Market watchers said the aggressive expansion by the group in almost every vertical has triggered investors' interest while some attribute the recent rise to speculation as well.
All these stocks have beat the benchmark indices by a wide margin, as the BSE Sensex and the NSE Nifty50 have gained 6.2 per cent and 7.5 per cent respectively during the same period. The broader S&P500 has given a return of 10.30 per cent.
Adani Trans: steals the show
The biggest gainer among the Adani group stock is Adani Transmission Limited (ATL), with 92 per cent gains, followed by flagship Adani Enterprises Ltd (AEL) with 87 per cent and CGD player Adani Total Gas with 84 per cent gains. The infrastructure major's ports arm, Adani Ports and Special Economic Zone Ltd (APSEZ) has gained by 49 per cent closely followed by Adani Power 42 per cent. The renewable energy firm, Adani Green Energy rose 10 per cent.
"No doubt, these stocks have been best performers. We are seeing huge volumes in these stocks. Therefore they caught the attention of day traders and short-term players due to consistent momentum. While some stocks such as APSEZ are having genuine news-based rally, other group companies show heavy volumes without any strong news or development to support price rally," said a Mumbai-based stock broker not willing to be quoted.
Trading volumes spike
The volume data compiled by BusinessLine showed that five-day average volumes have seen noticeable jump in past two months. While APSEZ has seen its average volumes for five-day period ending March 4 jumping by 210 per cent to 19 million shares as against 6 million for the five-day period ending January 1. Similarly, AGEL volumes rose by 264 per cent and Adani Power volumes were up 142 per cent.
While deliverable volumes in Adani Total Gas and Adani Transmission rose to over 50 per cent, signalling some genunie buying, others are in the range of about 30 per cent, indicating higher day-trading activity. An analyst from a leading equity advisory group said, "The Group- is good at execution of projects. They are expanding rapidly into multiple businesses, but with huge pile of debt. The finances of most of these companies are modest. APSEZ is a cash-cow for the group, but ATL and APL are a drag." The Group has a gross debt of ₹1.41 lakh crore as on December 2020.
On Thursday, market capitalisation of AGEL is nearing ₹2 lakh crore, APSEZ has crossed ₹1.52 lakh crore and that of AEL is ₹1.01 lakh crore while ATL is also inching closer to ₹1 lakh crore.
However, financial position shows ATL posted standalone net loss of ₹4 crore on net sales of ₹304 crore for December 2020 quarter, while AEL's net profit stood at ₹117 crore on revenues of ₹4,078 crore. APSEZ posted net profit of ₹623 crore on revenues of ₹ 1,305 crore. AGEL profits were at ₹ 70 crore on revenues of ₹233 crore.