Adani Ports stock nosedives on its Israel connection

• After stock falls, Adani Ports says that the contribution of its Israeli port is relatively small.
• APSEZ completed the purchase of Haifa port in January this year.
• The on-ground action is concentrated in South Israel and Haifa port is situated in the North of the country.
  

The stock of Adani Ports has fallen almost five percent on Monday on concerns over the impact of Israel-Hamas conflict on its Haifa Port. The stock, which saw 4.9% shaved off, is one of the top losers on Nifty50.

The company completed the purchase of the Haifa port earlier this year for a consideration of $1.2 billion. Adani Port released a statement saying that the contribution of its Israeli port is not very high.

“The overall contribution of Haifa in Adani Ports’ numbers is relatively small at 3% of the total cargo volume. For the current FY24, we have guided for Haifa Cargo volumes range of 10-12 MMT and Adani Ports’ total cargo volume guidance of 370-390 MMT,” it said in a statement.

From April to September 2023, the ports’ total cargo volume was around 203 MMT. Of which, the Haifa share is around 6 MMT. “We stay confident of Adani Ports’ business performance,” the company added.

An important detail that the company has pointed out is that its port located in Haifa is far away from the action. “We are closely monitoring the action on ground which is concentrated in South Israel, whereas Haifa port is situated in the North,” the company said.

The tensions in the Middle East rose after Palestinian group Hamas launched an offensive against Israel and also took in a few hostages. Israel too retaliated with air strikes, and the country’s Prime Minister Benjamin Netanyahu said that the country "is at war" in an address.

Adani Group is one of the few top Indian companies to have interests in Israel. “We have taken measures to ensure the safety of our employees and all of them are safe. We remain fully alert and prepared with a business continuity plan that will enable us to respond effectively to any eventuality,” it added.