Adani Group stocks rise up to 7%; what’s behind the rally?

Adani Group stocks posted significant gains during morning trade on Monday, November 25, following the BJP-led alliance's decisive victory in the 2024 Maharashtra assembly elections.

Maharashtra and Jharkhand had their 2024 state assembly election results announced on November 23. The Bharatiya Janata Party (BJP)-led Mahayuti alliance saw a landslide victory in Maharashtra, while in Jharkhand, the JMM-led INDIA bloc scored a big win.

Market participants believe the assembly election outcome has resolved doubts about continuing Adani's redevelopment project in Mumbai’s Dharavi.

"If the current government had given them the Dharavi project and they had come back to power with a solid majority, it would definitely be good news for Adani Group," said Avinash Gorakshakar, the head of research at Profitmart Securities.

Shares of the flagship firm Adani Enterprises rose 4 per cent, while those of Adani Ports jumped almost 5 per cent. Adani Energy Solutions shares jumped 7 per cent, while those of Adani Green Energy and Adani Total Gas rose 6 per cent and 5 per cent, respectively.

Shares of Adani Power rose over 4 per cent. Shares of Ambuja Cements and Adani Wilmar climbed 3 per cent each. ACC share price climbed over 2 per cent.

As Mint reported earlier, on 14 July 2023, the Maharashtra government approved the Adani group to redevelop the crowded Dharavi slum—a complex 590-acre cluster of irregular structures, rickety tenements and decrepit buildings sheltering over 900,000 citizens and hundreds of small commercial setups.

Meanwhile, Adani Group, on Monday, November 25, released Adani Portfolio’s H1FY25 (first half of FY25) and trailing-twelve-month (TTM) results and credit compendium, showing remarkable performance of the group.

"Trailing-twelve-month EBITDA at ₹83,440 crore, increased 17 per cent year-on-year (YoY). After adjusting for prior period incomes, it was up 34.3 per cent YoY. H1FY25 EBITDA rose 12 per cent YoY to ₹44,212 crore. It was up 25.5 per cent YoY after adjusting for prior incomes," said a statement from Adani Group.

"The strong performance in the first half was led by Adani Enterprises' emerging infra businesses, including solar and wind manufacturing, part of a fully integrated green hydrogen chain, airports and roads—EBITDA from these incubating businesses increased by 70.14 per cent YoY in H1FY25," it said.

On Thursday, November 21, Adani group stocks suffered up to 23 per cent after Gautam Adani and several other top executives of the group were indicted in New York over their role in an alleged multibillion-dollar bribery and fraud scheme.

In January 2023, a US-based short-seller, Hindenburg Research, accused Adani Group of using offshore tax havens improperly. The report triggered a sharp selloff in Adani Group stocks, causing an approximately $150 billion outflow in the group stocks.

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