Adani Enterprises' Stock Ends Day With Gains After Rebuttal To Hindenburg Report
Shares of the company ended with a 4.76% gain, as against a 0.25% advance in the benchmark Nifty 50.
Shares of Adani Enterprises Ltd. closed higher on Monday, breaking a two-day losing streak, following Adani Group's 413-page response to Hindenburg Research's allegations.
The stock of the flagship Adani Group company, which launched its follow-up public offering on Jan. 27, started the day with advances and was the top Nifty 50 member after market open.
Shares of the company ended with a 4.76% gain, as against a 0.25% advance in the benchmark Nifty 50.
The total traded volume was 8.7 times the 30-day average. The relative strength index was at 23, suggesting that the stock is oversold.
Of the two analysts tracking the company, one maintained 'buy' and the other maintained 'hold', while none suggested a 'sell', according to Bloomberg data. The 12-month consensus price target implies an upside of 21.4%.
The Adani Group stocks were trading mixed on Monday, after most of them declined for three consecutive days following Hindenburg Research's report alleging fraud and stock manipulation.
The group's Chief Financial Officer Jugeshinder Singh, called it a "malicious combination of selective misinformation and stale, baseless, and discredited allegations that have been tested and rejected by India’s highest courts".
"The timing of the report’s publication clearly betrays a brazen, mala fide intention to undermine the Adani Group’s reputation with the principal objective of damaging the upcoming follow-on public offering from Adani Enterprises, the biggest FPO ever in India," Singh said in a statement last week.
Adani Enterprises Rs 20,000 crore follow-on public offering was subscribed at 1% on its first day of subscription. The company pegged the floor price of the issue at Rs 3,112 per share and the cap price at Rs 3,276 apiece, according to the red herring prospectus.
The group, however, is confident that the public offering will be fully subscribed, led by demand from institutional investors.
The follow-on public offering was subscribed 0.02 times, or 2%, as on 3:39 p.m. on Monday. The demand was led by employee reserved (0.11 times), followed by retail investors (0.04 times) and non institutional investors (0.01 times), according to BSE.
Disclaimer: Adani Enterprises is in the process of acquiring a 49% stake in Quintillion Business Media Ltd., the owner of BQ Prime.