For the past few months, Gautam Adani promoted companies of Adani Group are witnessing a consistent fall in their share price. The group's parent company, Adani Enterprises touched a 52-week low of Rs442 per share on Tuesday. While its power company, Adani Power, is trading near a 52-week low, at Rs78 per share.
Experts believe that the harsh rebuke by Karnataka Lokayukta for illegal mining in the state and increase in imported coal prices are some of the reasons for the dip in sentiments as far as the stocks of the company are concerned. However, its port and SEZ company, Mundra Port & Special Economic Zone (MPSEZ) doesn't seem to have been affected.
"Adani Power has also fallen due to rise in imported coal prices. Other factors include expensive imported coal from Indonesia and the Lokayuka issue. Various other problems have also led to consistent fall in share prices of Adani Enterprises," V-P, equity research, Nirmal Bang Securities, Sunil Jain said.
Vaibhav Shah, MD, Monarch Projects, Vaibhav Shah said that due to poor sentiments there is selling pressure by investors on Adani Group scrips. "After the company's name was linked to illegal mining in Karnataka, share prices of Adani Enterprises have consistently fallen," he said. But, both analyst and experts believe that fundamentally, the group companies are strong. "Power sector is likely to remain under pressure due to coal prices. It looks like a short term phenomenon," said Jain.
According to Shah, in the long term, the group companies of Adani are expected to perform well as results are estimated better in this fiscal. "Fundamentally, Adani Enterprises is strong and is a good company," said Shah. Officials at the company could not be reached for their comments.
It should be noted that last year the total market capital of all the three companies together had almost touched the level of over Rs1, 33, 000 crore. On Tuesday, the market capital of the three companies - Adani Enterprises, Adani Power and MPSEZ - fell to around Rs1 lakh crore.
On Tuesday when the markets closed, the total market capital of the company stood at Rs1,00,893 crore, including Adani Enterprises at Rs53,022 crore, Adani Power at Rs17,069 crore and MPSEZ at Rs30,802 crore.
