The price of Adani Power decreased 5% to Rs 235.65. At Rs 491.45, Adani Wilmar reached its 5% lower circuit limit. Adani Transmission experienced an 18% decline and reached a low of Rs 1,648.
Following a selloff last week, shares of Adani Enterprises, whose Rs 20,000 crore follow-on public offer is in progress, rebounded in Monday’s trade. Adani Total Gas, Adani Transmission, and Adani Green, however, all experienced a sustained selloff and saw declines of up to 20%.
Adani Enterprises’ stock increased 9.35% to Rs 3,020.45 at 9:19 a.m. On Friday, the stock had dropped 18.52 percent. While the CFO of the Adani Group, Jugeshinder Singh, expressed confidence that the Rs 20,000 crore follow-on public offer (FPO by Adani Enterprises) will be successful and that his organisation had no plans to alter the price band or the offer term, In a filing to the BSE, Adani Enterprises stated that if the offer price is less than the allocation price for anchor investors, the difference will not be financed to the anchor investors. On February 1, the FPO committee is expected to meet to approve the offer price and prospectus for the offer.
Stocks of the Adani Group have recently suffered as a result of a Hindenburg Research analysis. The group claims that the research firm plagiarised from company disclosures and did not conduct adequate research. Additionally, it said that they either conducted inadequate research or did so but mislead the public.
Singh stated that the FPO will go according to schedule in an exclusive interview with Siddharth Zarabi, Managing Editor of Business Today Television. Singh claimed that his business was scrupulous in the method it used to raise money. According to him, the FPO mechanism offered Adani Enterprises the freedom to fill the book according to the overall subscription, which will now be predominately made up of institutional and long-term strategic book. When prices for Adani Enterprises fell below the lower limit of the price range of Rs 3,112 on Friday due to a significant selloff, Singh was questioned about what would happen to the FPO’s retail sector.
Adani Enterprises, according to Singh, is not a typical corporation that trades based on value factors like earnings multiples. An incubator, that is. What it incubates is where its worth lies. Airports, ports, green hydrogen, data centres, Adani Wilmar, Adani Digital Labs, and mining companies are all incubated by Adani Enterprises. They are important enterprises. The ones with value are the companies. You can get access to that value through Adani Enterprises. The amount of Adani Enterprises shares that one can purchase is what people are most interested in. When the businesses are demerged and investors end up owning an equal amount of shares based on ratios, then is when value will be created, according to Singh.
According to Singh, the share price is extremely sensitive to small-scale investors. However, while there may be a volatility concern for non-family offices, long-term institutional investors, and long-term strategic investors, it does not alter for them the value of Adani Enterprises.
Why Adani’s Share Price Fall Today?
The corporation has declared that it is withdrawing its offer to delist. In July 2020, the company’s shareholders accepted the delisting of its shares from the BSE and NSE, and in January 2021, they applied to the exchanges for permission to do so. The company hasn’t gotten the exchanges’ clearance in principle. As a result, it is abandoning its offer to delist shares due to delays and lack of commercial viability.
Due to lower revenues, the Adani group reported a combined net loss of Rs 230.60 crore for the September 2021 quarter. The company’s combined net profit for the three months ended September 30, 2020 was Rs 2,228.05 crore, according to a BSE report.
The company stated in a statement that the significant contribution of one-time items to the post-tax profit in the second quarter of the prior year was the reason for the total comprehensive loss after tax of (-) Rs 239 crore for Q2 FY2021-22 as opposed to an income of Rs 2,216 crore for Q2 FY2020-21.
The company’s entire revenue for the quarter fell from Rs 8,792,28 crore the year before to Rs 5,571,76 crore.
The company claims that various regulatory directives were the reason for a higher one-time revenue recognition of Rs 3,233 crore in the second quarter of the previous year.
Why Adani Stock Market Prices Fall Down?
The turn of events was precipitated by media reports claiming that the National Securities Depository Ltd (NSDL) had frozen the accounts of three foreign organisations that had made significant investments in Adani Group shares.
These claims have been refuted by the National Securities Depository Ltd, although numerous reports have revealed that they are true. Since that time, four businesses owned by the Adani Group have lost more than Rs 43,500 crore.
Drop in Adani’s net worth
The decline in the share prices of the Adani Group companies has hurt Gautam Adani’s wealth. As of October 2021, his net worth was estimated to be $7,590 crores.
The largest private thermal power plant in India is Adani Power Ltd (APL), which belongs to the Adani Group.
The company operates six power plants spread across Gujarat, Maharashtra, Karnataka, Rajasthan, and Chhattisgarh with a total installed thermal power capacity of 12,410 megawatts (MW), excluding a 40-MW solar power plant in Gujarat. Thanks to a top-notch team of experts in all areas of power, Adani Power is on track to realise its full development potential.
The company is utilising innovation and technology to assist India in becoming a power-surplus country with high-quality, affordable electricity for all.