The next day: Adani Group stocks rise after group denies news reports

Shares of Adani Group rose on Wednesday after the group denied news reports that had raised concerns about its ability to repay debt.

Shares of Adani Enterprises, group’s flagship firm, rose by 8.7 per cent, while those of Adani Ports and Special Economic Zone rose by 7.2 per cent. Adani Wilmar, New Delhi Television and Adani Power gained 5 per cent each. However, Adani Total Gas fell by 4.3 per cent, Adani Green Energy by 4.4 per cent and Adani Transmission by 1.3 per cent.

As a result, the combined market capitalisation of the group rose by over Rs 20,000 crore.

Earlier, one new report had claimed that the conglomerate is seeking to renegotiate the terms of $4 billion worth of loans while another had raised concerns about its $2.15 billion loan repayment claim.
 

Analysts pointed out that unless valuations moderate, the firm stocks will be susceptible to volatility induced by negative news flow.

"Except for the cement and ports stock of the group, the others are very expensive. The ports and cement stocks have some support at these levels and I don't think they will fall dramatically. Others continue to be quite expensive and vulnerable to negative news flow. There are some investors who take short-term positions and whenever any negative news comes they panic sell,' said UR Bhat, co-founder, Alphaniti Fintech.

The conglomerate termed the news report which claimed that it had not completed repayment of Rs 2.15 billion in share-backed debt as a baseless and deliberately mischievous claim.

In a filing to exchanges, Adani Group said it has completed full prepayment of margin-linked share-backed financing aggregating to $ 2.15 billion and added that “…and all corresponding shares pledged for those facilities have been released. "

The group further said that as per present rules, any share pledge or release is automatically reported by system driven disclosure (SDD) mechanism of the depository participant, and no separate filing is required to be made.