Adani Enterprises shares rise 3% after subsidiary signs deal with Australia's Caravel Minerals copper project

Adani Enterprises shares rise 3% after subsidiary signs deal with Australia's Caravel Minerals copper project

Adani Enterprises shares rose 3% on November 7 after the Adani Group's flagship firm said its unit Kutch Copper Ltd (KCL) signed pact with Caravel Minerals to advance development of a copper project in western Australia. Shares of Caravel Minerals rose 17%.

Adani Enterprises shares on NSE snapped five-session losses on November 7 and at 2:50 pm they were trading 2.5% higher at Rs 2,373 apiece.

The initial capital expenditure for the project is estimated at A$1.7 billion ($1.10 billion), with KCL granted first rights to participate in direct equity or project-level investments during the term of the agreement.

The conglomerate's $1.2-billion Kutch Copper facility in Gujarat is the world's biggest single-location plant of its type. The unit has applied to become a listed copper-producing brand on the London Metal Exchange.

Global copper demand is projected to surge by 50% by 2040, the Adani Group company said, adding that the Caravel-Kutch Copper collaboration is expected to make a significant contribution to critical-minerals supply chains.

The partnership will also leverage the Free Trade Agreement between India and Australia to promote "cross-border resource development and workforce skilling".

Adani Enterprises Q2 results

Earlier this week, Adani Enterprises reported a drop in second-quarter adjusted profit as weakness in its core coal trading business offset gains in renewable energy, even as its board approved a Rs 25,000-crore rights issue.

Profit before exceptional items and tax at the flagship firm of Adani Group dropped to Rs 814 crore for the quarter ended Sept. 30, from Rs 2,409 crore a year earlier.

The company recorded an exceptional gain of Rs 3,583 crore in the quarter related to the sale of stake in AWL Agri Business, formerly known as Adani Wilmar.

Coal-fired power generation, which typically contributes to about three-quarters of the country's annual electricity output, has been declining due to the rapid growth of the renewables sector, reflecting a shift in fuel use patterns as the country moves to greener forms of energy.

The ports-to-power conglomerate's coal trading business is its biggest segment, contributing a major portion of its overall revenue.

It reported a near 29% fall in revenue to Rs 6,658 crore in the reporting quarter, lagging behind others in the past six quarters. The decline outweighed the growth in Adani Enterproses' new energy segment and airport segment, which recorded 3.7% and 42.7% rise in revenue in the quarter.