Adani stocks: Foreign brokerage Bernstein in its latest note suggested an ‘Underperform’ rating on Adani Green Energy, ‘Outperform’ recommendation for Adani Ports & Special Economic Zone Ltd and ‘Market-Perform’ on Ambuja Cements. The brokerage said it has not changed its ratings post the US SEC event as it awaits further clarity on developments in India related to it.
“Within our coverage Adani Ports continues to trade below JSW Infra and Concor, Adani Green which doesn’t have a close peer is in line with private sector peers such as JSW Energy and Tata Power, and Ambuja Cements also trades broadly in line with large cement names,” Bernstein said.
The brokerage suggested a target price of Rs 800 for Adani Green Energy, Rs 1,616 for Adani Ports and Rs 572 on Ambuja Cements. On Tuesday, the Adani Green Energy stock was trading 0.52 per cent lower at Rs 1,321. Ambuja Cements shares were up 5.63 per cent at Rs 569.30. Adani Ports was up 6.21 per cent at Rs 1,291.05.
Bernstein said Adani group stocks have been volatile since the beginning of 2023, starting with the short-seller report which came on January 24, 2023, just before Adani Enterprise Ltd was doing a fund raise. Post the event, the groups stock prices crashed and bond yields shot up.
“Over time the group stocks rebounded but most did not get back to earlier levels (e.g. Adani Green). However, after the news from US SEC on 21 Nov’24, stock and bond prices plummeted again. But this time the drop wasn’t as severe as the previous one, and the prices began to recover shortly thereafter. In fact some group stocks are trading above the level they were at pre-US SEC developments,” it said.
Last time Adani Green had a significant part of its debt up for repayment in FY25, including a $750 million holdco bond, which had fallen sharply on the event.
This time, the repayment schedule is more balanced, except for a payment of Rs 96 billion in H2FY25, of which Rs 89 billion is due to dollar revolving facility taken by the company. But then again, considering the company is sitting on Rs 59 billionof cash, it seems lesser of a concern,” Bernstein said.
