Adani group adds ₹66K cr in value amid choppy markets after Sebi relief

Group stocks gain between 0.3% and 12.4%

Adani group shares surged on Friday, adding nearly ₹66,000 crore in market capitalisation, a day after the Securities and Exchange Board of India (Sebi) dismissed key allegations made by now defunct US short-seller Hindenburg Research, even as the equity market slipped with the BSE Sensex ending nearly half a per cent lower on profit-taking after a 4 per cent rally over the past 12 sessions.

 

Banking stocks were the biggest drag on overall performance.

 

The 30-share Sensex slipped 387.73 points, or 0.47 per cent, to close at 82,626.23, after falling as much as 528.04 points, or 0.63 per cent, intraday to 82,485.92. The Nifty 50 declined 96.55 points, or 0.38 per cent, to 25,327.05. Adani Enterprises was the standout performer among Nifty 50 stocks, climbing 5.3 per cent.

 

All nine listed Adani companies advanced, with gains ranging between 0.3 per cent and 12.4 per cent, led by Adani Power.

 

The conglomerate’s combined market value rose 4.8 per cent, or ₹65,932 crore, to ₹14.28 trillion -- the largest single-day increase in absolute terms since May 12.

 

Market experts said Sebi’s verdict lifts a major cloud over the Gautam Adani-led conglomerate. “This order clears a lot of taints for the group and will help bring back investor confidence. With the overhang gone, large investors who were on the sidelines may now start deploying serious money,” said Deven Choksey, managing director at KRChoksey Shares. 

 

In two separate orders issued on Thursday, Sebi cleared the group of charges relating to alleged fund diversion and violations of related-party transaction norms. The regulator ruled that the transactions highlighted by Hindenburg in its 2023 report could not be classified as related-party deals. Consequently, the Adani firms could not be found guilty of breaching disclosure obligations or engaging in market manipulation.

 

“After an exhaustive investigation, Sebi has reaffirmed what we have always maintained, that the Hindenburg claims were baseless. Transparency and integrity have always defined the Adani group,” Gautam Adani, chairman, Adani group, wrote on X following the regulator’s orders.

 

Sources, however, said Sebi continues to examine allegations concerning possible violations of minimum public shareholding and insider trading norms raised by Hindenburg Research.

 

The January 2023 Hindenburg report triggered a sharp selloff, wiping out nearly ₹12 trillion in market value. The group’s combined capitalisation, which stood at ₹19.2 trillion before the short-seller’s attack, plunged to ₹6.8 trillion by February 27, 2023.

 

Adani Power -- the day’s top gainer -- also drew strength from Morgan Stanley’s initiation of coverage with an ‘overweight’ rating and a price target of ₹818. The stock jumped 12.4 per cent to close at ₹709.

 

“Adani Power is a good illustration of corporate turnaround in India, with regulatory challenges largely resolved and multiple value-accretive acquisitions under its belt. The company is well-positioned to deliver strong earnings growth through timely project completions and additional PPA (Power Purchase Agreement) wins,” the brokerage wrote, projecting a threefold increase in operating profit by FY33.

 

The BSE smallcap gauge went up by 0.16 per cent while midcap index dipped 0.09 per cent.

 

On the weekly front, the BSE benchmark jumped 721.53 points or 0.88 per cent, and the Nifty 50 climbed 213.05 points or 0.84 per cent.

 

Supported by optimism around US-India trade negotiations, the rupee rose 3 paise versus the dollar and settled at 88.10 on Friday. Likely intervention by the Reserve Bank of India also helped the domestic unit in controlling volatility, according to traders.