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Adani Group stocks have rallied up to 70% in last one month — here’s what is driving each one of them

Adani Group stocks have rallied up to 70% in last one month — here’s what is driving each one of them
BCCLBillionaire Gautam Adani owned Adani Group subsidiaries’ shares have seen a stellar rally in the last one month. The 70% jump in Adani Enterprises to 68% jump in Adani Green has been led by the group’s recent acquisitions, business developments, fundraising plans and investors’ betting on the long-term prospects.

The Adani Group conglomerate operates five subsidiaries around India, all of which have made news on the back of business developments.

Here’s snapshot on why Adani subsidiaries’ have witnessed this surge:

​Adani Enterprises

​Adani Enterprises

Adani Enterprises shares have multiplied investors' wealth with stock surging nearly 70% in the last one month — all thanks to Adani's recent acquisition of Mumbai International airport from GVK Group. Adani’s aviation bet will strengthen their position as Mumbai’s CSIA is one of the top 5 global metropolitan centers, and the airport is expected to become the nation’s leading international and domestic airport.

Not only that, but the company has also achieved “financial closure of the Navi Mumbai International Airport project at the earliest to commence construction.” Its subsidiary Adani Airport Holdings also bagged the bid to run six Airport Authority of India-built non-metro airports in the city of Lucknow, Jaipur, Guwahati, Ahmedabad, Thiruvananthapuram, and Mangalore.

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​Adani Green

​Adani Green

Adani Green shares also gained over 68% in the past one month as investors pin the hopes of the company’s long term prospects.

Adani Green is the largest solar power generation company in the world, according to Mercom Capital. As per the company report, Adani’s renewable energy portfolio exceeds the total capacity installed by the entire United States solar industry in 2019 and will displace over 1.4 billion tons of carbon dioxide over the life of its assets.

According to reports, Adani Green Energy is also in talks to raise $1.35 billion to fund four construction projects over the next couple of years. The reports suggested that the company has already begun discussions with lenders such as Standard Chartered Bank, JPMorgan, MUFG, Barclays, DBS Bank, and Qatar National Bank, among others.

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​Adani Gas

​Adani Gas

Adani Gas has gained 23% in the past month.

Adani Gas’ CEO Suresh Manglani last month revealed that along with the French energy giant Total SA, they would soon be seeking government nod to open retail fuel stations in India. The joint venture, Total Adani Fuels Marketing, will shortly apply for a licence under the new liberal fuel retailing rules, Manglani told investors on a conference call..

Brokerages are also bullish on the back of healthy gross margins outlook. According to the ICICI Direct report, Adani Gas’ gross margins in the first quarter were at 19/scm YoY as the company benefited from low spot LNG prices. ICICI Direct maintains a positive outlook on the stock from a long term perspective “as AGL is well poised to benefit from India’s growing CGD sector.”

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​Adani Ports and SEZ

​Adani Ports and SEZ

Multiple fundraising plans have led to a 17% rally in shares of Adani Ports and SEZ.

On August 30, The Adani Ports and Special Economic Zone promoters also pledged 206.09 lakh shares in favour of Credit Suisse AG to raise ₹430 crore for a group company.

Earlier on August 11, the board of the company approved a proposal to raise up to ₹3,000 crore through non-convertible debentures (NCDs). NCDs are used by companies to raise long-term capital, which gets listed on stock-exchanges, but can’t be converted into shares or equities.

It also decided to list $750 million foreign currency bonds on India International Exchange (India INX). The company said the bonds would be listed on India INX’s Global Securities Market, which is a pathway between global investors with Indian and foreign issuers.

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​Adani Power

​Adani Power

Adani Power shares climbed 10% — relief coming in due to the Supreme Court’s decision on compensatory tariff. On August 31, the Supreme Court directed three Rajasthan power distribution companies to pay compensatory tariff amounting to ₹5000 crore to Adani Power. The tariff will be calculated from 2013 and the court has directed the discoms to pay this money within two months of the judgement.

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