Adani Group stocks crash over 18% amid tight election race
What's the story
Adani Group stocks took a significant hit on Tuesday as the Indian markets reacted to tighter election results than expected.
The most notable declines were observed in Adani Total Gas and Adani Green Energy, both falling over 18% in today's session.
This led to a nearly ₹1.35 lakh crore drop in the market capitalization of Adani stocks, erasing gains from the previous session.
Stock decline
Significant drops in Adani Group's intra-day deals
In intra-day deals, Adani Total Gas experienced the most significant drop, falling 18.5% to below ₹1,000 to its day's low of ₹912.05.
This was closely followed by Adani Green Energy, which fell 18.3% to ₹1,664.95.
Additionally, both Adani Energy Solutions and Adani Power saw declines of 14.2% and 13.6% respectively.
Widespread impact
Other Adani Group companies also witness losses
Other companies within the Adani Group also experienced losses. Adani Enterprises, Adani Ports and Adani Wilmar each lost 10% in intra-day deals.
Specifically, both Adani Ports and Adani Wilmar fell as much as 9.8% each to ₹1428.90 and ₹322.20, respectively, while Adani Enterprises shed 10% to ₹3,280.85 after hitting a 52-week high yesterday.
Market value
Adani Group's market capitalization takes a hit
The combined market capitalization of all 10 listed Adani stocks also crashed by nearly ₹1.35 lakh crore.
This significant drop brought the total market value of the conglomerate's listed entities down to ₹18.07 crore from ₹19.42 lakh crore in the previous session, marking a substantial decrease in value for the group as a whole.
Future prospects
Jefferies report maintains bullish outlook on Adani Group
Despite the recent setback, a Jefferies report maintained a bullish outlook on Adani Group firms.
The report highlighted the group's rebound from losses incurred during the Hindenburg episode and its current "expansion spree," with plans for a $90 billion capital expenditure over the next decade.
This optimistic view suggests potential growth and recovery for the group in future market sessions.
Fiscal health
Adani Group's financial performance and debt management
The Adani Group has been focusing on reducing its debt and the founders' share pledge during the financial year 2023-24, according to the Jefferies report.
The group's profit after tax (PAT) in FY24 jumped 55% to ₹30,768 crore.
Interestingly, the group's net debt remained stable at ₹2.2 lakh crore in 2023-24, compared to ₹2.3 lakh crore the previous year, indicating effective debt management strategies.