Gautam Adani-led Adani Group stocks extended their rebound on Wednesday after the conglomerate took some crucial steps to restore investor confidence amid the recent selloff triggered by Hindenburg Research report. The stock price of group companies witnessed trend reversal after the promoters of listed entities announced prepaying $1.114 billion of loans to release some pledged shares, which eased investor and rating agencies' concerns over leverage.
Adani Enterprises, the flagship company of the Adani group, has emerged as the biggest gainer among the 10-listed entities, with the share price more than doubling from its 52-week low of ₹1,017, touched on February 3, to ₹2,065 in intraday today. The conglomerate has regained ₹54,075 crore in market cap during the said period, from ₹1.81 lakh crore on February 3 to ₹2.34 lakh crore in intraday today.
On Wednesday, the share price of Adani Enterprises opened higher for the second straight session, up 3.7% at ₹1,870 against the previous closing price of ₹1,802.50 on the BSE. During the session, the stock gained as much as 14.56% to hit an intraday high of ₹2,065. On Tuesday, the stock had closed 14.6% higher after losing more than 50% in market value in the last eight sessions since January 25, a day after the U.S.-based investment firm Hindenburg Research published a scratching report on Adani group.
In line with Adani Enterprises, most of the group stocks were trading in green, with Adani Power, Adani Wilmar, and Adani Transmission hitting their respective 5% upper circuit limit. Among others, Adani Ports and Special Economic Zone (APSEZ) gained as much as 7.6%, while Abuja cements rose 3.6% intraday.
Bucking the trend, Adani Total Gas shares opened lower for 12 consecutive sessions and locked in 5% lower circuit. The stock has lost 64.5% during this period. Adani Green Energy and ACC shares also slipped in red, reversing opening gains.
At Tuesday’s close, the total market cap of group companies stood at ₹11,506 crore, after falling by over ₹1 lakh crore on average in the last eight sessions following Hindenburg’s report.
Investors also kept a close eye on the results of Adani Enterprises, which is slated to be released on February 14. On Tuesday, three group companies – Adani Ports, Adani Green Energy, and Ambuja Cements – released their third quarter numbers, while Adani Transmission reported its December quarter results on Monday.
In a slew of positive developments, promoters of Adani group companies on Monday said they plan to prepay $1.114 billion of loans, ahead of the maturity in September 2024, to release some pledged shares in Adani Ports & Special Economic Zone, Adani Green Energy, and Adani Transmission. As part of the pre-payment plan, 168.27 million shares of Adani Ports, representing 12% of the promoters’ holding, will be released. In the case of Adani Green Energy, around 27.56 million shares, representing 3% of promoters’ holding, will be released, while about 11.77 million shares of Adani Transmission, representing 1.4% of promoters’ holding, will be released, the company said.
Last week, Adani Enterprises also announced the withdrawal of its ₹20,000-crore follow-on public offer (FPO) to safeguard the interest of its investing community amid sharp volatility in the company’s shares.