Adani Enterprises' Stocks Climb 3% Following Promoters' Increased Stake

22 Aug, 2023

Adani Enterprises' Stocks Climb 3% Following Promoters' Increased Stake

Adani Enterprises witnessed a notable increase of over 3% in its share value during the early trading hours on Tuesday, as a result of a significant upsurge in promoter stake. The parent company of the Adani Group, Kempas Trade and Investment, a promoter entity, engaged in the acquisition of 2.53 crore shares of Adani Enterprises through open market transactions between August 7 and August 18, as confirmed by exchange data. This acquisition translated to an overall boost in the promoters' stake in the company, elevating it from 67.65% to 69.87%. Calculated against Monday's closing price on the National Stock Exchange (NSE), this stake acquisition was estimated to be worth approximately ₹6,675 crore. This positive development culminated in a 2.42% surge in the conglomerate's share price, which closed at ₹2,639.75 on the NSE.

In response to this news, the shares of Adani Enterprises commenced trading with a 1.2% increase, starting at ₹2,671.50, in contrast to the preceding closing price of ₹2,638.60 on the Bombay Stock Exchange (BSE). During the initial trading hour, the stock soared by as much as 3.1%, reaching ₹2,720.65, consequently propelling the market capitalization to a substantial ₹3.07 lakh crore. Notably, the trading activity also saw more than 1 lakh shares, equivalent to a value exceeding ₹6,400 crore, changing hands.

Despite experiencing a decline of nearly 12% over the past year and a 30% decrease in the calendar year 2023, the stock displayed significant gains in the recent six-month period, ascending by 92%, along with an 11% increase in the last month, largely attributed to strategic value-based investments by discerning investors.

The surge in Adani Enterprises' shares over the past four trading sessions, achieving an upward movement of over 11%, can be largely attributed to substantial investments made by Rajiv Jain-led GQG Partners within companies led by billionaire Gautam Adani.

In a recent development, GQG Partners, under the leadership of Rajiv Jain, expanded its holdings in Adani Ports & Special Economic Zone (APSEZ) by procuring an additional 22.56 lakh shares through bulk deals on August 17, 2023, resulting in a rise in its stake from 4.93% to 5.03%.

Furthermore, a significant event on the investment front unfolded as the U.S.-based investment firm acquired an impressive 8.1% stake in Adani Power, marking the largest single equity deal in the Indian stock market to date. The fund secured 31.2 crore equity shares of Adani Power, amounting to more than ₹9,000 crore ($1.1 billion), via a series of block deals on August 16.

GQG Partners has strategically accumulated holdings in five out of the ten Adani Group firms, namely Adani Enterprises, Adani Ports, Adani Green Energy, Adani Transmission (renamed as Adani Energy Solutions), and Adani Power.

This year witnessed significant actions by GQG Partners, starting with acquiring minority stakes in four of the publicly listed Adani Group companies, namely AEL, APSEZ, AGEL, and ATL. This trend continued in June, with additional stake acquisitions in the flagship company Adani Enterprises and the renewable energy entity Adani Green Energy, increasing their stakes by 1.6% and 2.2%, respectively.