The Adani group of stocks have lost 60 percent in value since the Hindenburg Research report was released on January 24. The combined market capitalisation of the 10 Adani stocks (A10) has fallen from the day of the report’s release to Rs 8,98,832.57 crore as of February 13, shaving off a colossal Rs 10,22,870.454 crore, the biggest in the history of Indian stock markets.
Considering the tremendous interest in Adani stocks because of its large retail and institutional shareholding and the influence it has on overall market sentiment, Moneycontrol brings to you an easy tool to gauge sentiment by introducing A10, an index of the 10 Adani group companies—ACC, Adani Enterprises, Adani Green Energy, Adani Ports, Adani Power, Adani Total Gas, Adani Transmission, Adani Wilmar, Ambuja Cement and NDTV.
The index captures the real-time price movement in all 10 Adani group stocks. We will track the performance of the index and update readers at the end of the trading day.
The individual companies in A10 have weights in proportion to their total market cap. As on February 13, Adani Enterprises, with a market cap of 1,25,755.1 crore, was the largest weight in A10, followed by Adani Total Gas and Adani Ports.
The Adani Group has been the poster boy of the bull rally in the stock market in recent years. Its flagship Adani Enterprises, which was in the market to raise Rs 20,000 crore in a follow-on public offering to power expansion and cut debt, saw an unprecedented gain of 256 percent and 126 percent in 2021 and 2022, respectively.
The group, via its bouquet of companies, runs several ports and airports, supplies electricity to key cities, and is one of the largest manufacturers of cement in the country, among others.
The bullishness around Adani stocks came to an abrupt end after a report by Hindenburg alleged stock manipulation and fraud at the company. The group vehemently denied the allegations. But the damage was done.
The biggest loser since the Hindenburg report is Adani Green Energy (down 73 percent), followed by Adani Transmission (down 70 percent) and Adani Total Gas (down 67 percent).
The most resilient have been Ambuja Cement and ACC—two stocks that the Street considers as value buys.
The volatility in Adani stocks continues even as the management tries to assuage markets by reaffirming its financial strength. The group has taken on large debts to fuel its business expansion.
The Adani Group has said its gross debt stands at $30 billion. According to analysts, though, the group does not face any default risks, given that it has valuable assets on the ground, however, it will be forced to slow its pace of growth as raising capital will be a tough ask going forward.
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