MUMBAI
: The Adani Group of shares showed its biggest rise in market capitalization of more than a trillion rupees for the first time since the Hindenburg report surfaced, days after the Supreme Court reserved its judgment on a slew of public interest litigations pleading for a judicial inquiry. into accusations of corporate wrongdoing and manipulation against the ports to renewable conglomerates.
The market, which was closed for the Guru Nanak Jayanti holiday on Monday, reacted to the conclusion of the SC hearing on Friday as investors interpreted some of the SC’s observations as giving credence to Sebi’s investigation into the Hindenburg report. which was published on the 24th. January
This led to short covering and fresh buying in group counters causing a total ₹1.04 trillion rise in the market cap of all 10 listed group companies. The charge was led by Adani Enterprises, the group flagship, whose 8.9% increase contributed ₹22,578 crore towards the group level market cap.
Also, there was heavy investment interest in Adani Power, Adani Green, Adani Energy Solutions, Adani Total Gas and Adani Ports, which rose between 5% and 19%.
Market analysts expect the positive investment sentiment to continue for a few more sessions.
“The SC sees no reason to supersede Sebi and investigate matters through an SIT (special investigation team),” said Rajesh Baheti, MD, Crosseas Capital. “There could be more rounds of sentimental buying in the group counters.”
According to Rajesh Palviya, SVP (technical and derivatives) at Axis Securities, the latest SC ruling “has eased the negative hangover on prices as the court has effectively put to rest questions about Sebi’s credibility to probe the Hindenburg crash.”
Palviya also expects the upward momentum to persist on “sentimental buying”.
An indication of increased investor interest was evident in delivery-based buying despite traded volumes exceeding their six-month averages. For example, the traded volume on Adani Enterprises at 1.2 crore shares was almost three times the six-month average traded volume of 42 lakh shares. However, delivery of 16 lakh shares took place.
In the case of Adani Green, the second largest contributor to the m-cap group, Tuesday’s trading volume at 1.16 was almost five times the six-month average volume. This was accompanied by delivery of 19.7 lakh shares.
Apart from the buying, huge bullish positions have been built on the futures of Adani Enterprises and Adani Ports. AEL witnessed total open positions rising by 53% accompanying the price increase, while Adani Ports’ total open positions rose by 44%. An increase in open positions along with a price increase indicates bullish sentiment.
Adani Power and Adani Enterprises were the most traded counters on NSE, ahead of HDFC Bank and Reliance. Total turnover of Adani Power stood at ₹2,972 crore while that of Adani Enterprises was ₹2,893 crore against that of HDFC Bank ₹2,182 crore and that of Reliance ₹1,643 crores.
The increase in turnover of six Adani group stocks alone accounted for 12.4% of the total traded turnover of NSE from ₹81,134 crore on Tuesday. Two of the 10 stocks, including Adani Power and Adani Ports, are trading above the prices coinciding with the publication of the Hindenburg report. Adani Power is trading 63% above the price while Adani Ports is trading 10% above the Hindenburg-related price.