Adani stocks: Despite global equity market reeling under the heat of Russia-Ukraine war for more than a month, some Adani stocks have given stellar return to its shareholders in this period. Recently listed Adani Wilmar share price has surged around 32 per cent in last one month and it has hit life-time high on Tuesday testing ₹500 levels for first time after listing. Similarly, Adani Power share price climbed to its life-time high of ₹181.40 apiece levels on NSE, delivering around 40 per cent return to its investors in last one month. Adani Port share has also surged around 7.50 per cent in last one month.
According to stock market experts, Adani stocks are skyrocketing due to rise in commodity prices. Commodity price rise, especially palm oil price increase is leading to higher trade activity that means more business for Adani Ports. They said that rise in palm oil price is giving margin benefit to Adani Wilmar on its unsold inventory and it will strengthen the balance sheet of the company as prices are expected to remain on the higher side for few more time.
On why Adani stocks are surging; Jay Thakkar, Head of Equity Research & VP at Marwadi Financial Services said, “Adani group stocks are well in upward momentum for a couple of days due to the high increase in commodity prices worldwide especially palm oil price which definitely helps the businesses of AWL i.e. Adani Wilmar Ltd. and Adani Ports Ltd. The prices of these commodities are expected to remain at elevated levels for some more time hence this will provide the margin benefit to the unsold inventory. Due to the rise in prices the overall transaction cost increases which definitely is in favor of Adani Ports. From technical perspective, AWL has hit the upper circuit for the 2 consecutive days and it has provided a breakout above ₹420 levels and now these levels will act as a crucial support in the near term.”
Jay Thakkar went on to add that Adani Ports has also provided a breakout from the sideways consolidation however it has a downtrend line resistance near ₹770 apiece levels and only a break above that will lead to a further northward.
On Adani Power share price rally; Jay Thakkar of Marwadi Financial Services said, “Adani Power share prices surged after the supreme court order in favor of Adani power as it has asked the Rajasthan based 3 Discoms to clear the company’s dues. Looking at the technical pattern, Adani Power Ltd. has hit a fresh 52 week high with a solid rise in its volumes hence it’s a price-volume breakout. Now, there is crucial support at ₹138 levels and till these levels are not broken the overall trend will remain bullish for the target of ₹200 and above.”
Echoing with Jay Thakkar’s views; Gurpreet Singh, Managing Director at Atallia Traders Private Limited said, “Adani Power stock price can be attributed to two major reasons — its investments in green energy sparking value buying and partial payments received by the Rajasthan and Maharashtra governments that were long due. Apart from this, the cancellation of the Adani Power de-listing has also worked in favor of the Adani Power share price rally.”
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.
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