Adani Wilmar freezes at 10% upper circuit after 25% fall from record high

Shares of Adani Wilmar (AWL) freezed in the 10 per cent upper circuit at Rs 345.80 on the BSE in Wednesday’s trade with only buyers seen on the counter. The stock of the Adani Group edible oil major had closed at Rs 314.40 on Tuesday, correcting 25 per cent from its record high level of Rs 419.90 on February 11, 2022. 

Till 09:58 am, a combined 7.7 million shares had changed hands and there were pending buy orders for 1.02 million shares on the NSE and BSE. In comparison, the S&P BSE Sensex was up 0.53 per cent at 57,602 points.

AWL had made its market debut on February 8, 2022. The company had raised Rs 3,600 through its initial public offer (IPO) by issuing shares at a price of Rs 230 per share.

AWL is a joint venture between the Adani group and Wilmar group, and is India's leading manufacturer of edible oil under the Fortune brand. Besides oil, the company offers products like wheat flour, rice, pulses, sugar and packaged food.

In its quarterly results after listing on stock exchanges, AWL registered a 66 per cent quarter-on-quarter (QoQ) growth in its consolidated net profit of Rs 211 crore for the third quarter ended December 31, 2021 (Q3FY22). The company’s consolidated revenues grew 41 per cent QoQ at Rs 14,379 crore.

During the quarter, AWL achieved an overall sales volume of 1.26 million metric tonnes (mmt) of which food as well as fast moving consumer goods (FMCG) vertical achieved volumes of 0.17 mmt in Q3 of FY'22, even as the company added five new Fortune Mart stores. As part of its growing foothold across South-East Asia, AWL acquired Bangladesh Edible Oil Limited (BEOL), by taking 100 per cent stake in Adani Wilmar Pte Ltd (AWPTE), a holding company of BEOL, AWL said.

AWL may pursue acquisitions in the edible oil and food industry to strengthen its presence in the southern regions where regional companies are strong. It intends to consolidate market share through acquisitions of regional players. The acquisition of BEOL will help it expand into the Bangladesh market and further increase edible oil manufacturing capacity. It is also seeking to acquire brands and businesses from food and FMCG companies, which will help expand its product and brand portfolio and increase manufacturing capacities and distribution access, brokerage ICICI Securities said in an IPO note.