Hindustan Times ST (Mumbai) - Live
Adani stocks surge on GQG Partners vote of confidence
Market value of 10 listed stocks rose by ₹68,352 crore post the deal
Ram Sahgal & Anirudh Laskar
MUMBAI: Investors cheered the sale of the Adani family trust’s stakes in four group companies to GQG Partners, with the market value of 10 listed stocks rising by ₹68,352 crore on Friday, the sharpest surge in the last seven months.
Adani Enterprises and Adani Ports led the gains, surging 17% and 9.9%, respectively, contributing 65% to the increase in investor wealth on Friday. The other two divested companies, Adani Green and Adani Transmission, remained locked at the 5% upper circuit. The rise in market capitalization is the highest absolute increase since 1 August, when it reached ₹68,385 crore. The SB Adani Family Trust sold between 2.5% and 4.1% of its holdings in Adani Enterprises, Adani Ports, Adani Green Energy, and Adani Transmission for ₹15,446 crore through a series of bulk deals on Thursday.
However, Adani Ports and Adani Total Gas suffered a setback as ratings agency ICRA Ltd downgraded their outlook to negative from stable, though their ratings remain unchanged. On the other hand, for Adani Total Gas, ICRA enhanced its ratings amount to ₹5,500 crore from ₹2,801 crore.
On Adani Ports, ICRA noted, “the group’s strong financial flexibility and Adani Ports’ track record of refinancing a large part of its debt with borrowings (mostly from overseas debt capital markets) of longer tenures at lower interest rates were the key credit strengths, which have been adversely impacted. ICRA will be monitoring the group’s ability to raise funds from domestic/global market as equity/debt at competitive rates.” The investment by GQG Partners, founded by Rajiv Jain, has been described as a “vote of confidence” for the embattled conglomerate by UR Bhat, co-founder of Alphaniti Fintech. “The stake purchase raises the potential for investment by domestic institutions in the likes of ACC, Ambuja Cements and Adani Ports,” Bhat said. “Jain is a very well-known name in the fund management business and would have conducted an abundant level of due diligence before putting money into the group as he is answerable to his clients with assets worth $92 billion.”