Since the accusations were made against Adani in the United States, there has been a sharp drop in all of the group’s shares, but today has seen a spectacular rise in its shares. Higher circuit was observed in many Adani Group stocks today. Adani Power rose 20 percent, while Adani Green Energy rose 10 percent. Shares of Adani Enterprises also rose over 10 per cent. At the same time, shares of Adani Total Gas also rose 20 per cent.
Due to the huge rise in the shares of the top 10 companies of the Adani Group, there was a huge jump in their market capitalization. Adani Group’s market capitalization increased by Rs 1.22 lakh crore. The increase came after the group said there were no bribery allegations against Gautam Adani and other group officials. On Wednesday, the market capitalization of Adani group companies rose to Rs 12.61 lakh crore from Rs 11.39 lakh crore on Tuesday.
Why did Adani shares rise?
Adani Green Energy Limited (AGEL) informed the stock exchange that Gautam Adani, Sagar Adani and Vineet Jain have been charged under the FCPA (no violations of the Foreign Corrupt Practices Act have been alleged).
The increase came despite global ratings agency Moody’s on Tuesday downgrading its outlook for seven Adani Group entities, including Adani Green Energy, Adani Ports and Adani Transmission, to “negative” from “stable”.
What should investors do now?
Sharing his opinion on Adani stock, Jashan Arora, director and whole-time promoter of Master Trust Group, said that whenever a rating agency downgrades a stock, investors may worry. There has been a lot of volatility in Adani Group shares, mainly due to regulatory scrutiny and investor sentiment. He said the forecast for the near future is still unclear. Before making any investment decisions, investors should carefully monitor court cases and evaluate the group’s financial situation.
If you plan to stay in the short term, consider your risk appetite. If the downgrade has affected your risk-reward ratio too much, it may be appropriate to reduce risk or book losses. The long-term prospects for the company remain strong, so it may be worth investing in this downturn. However, make sure it suits your risk tolerance and investment approach.
(Note: Before investing in any stock, definitely seek the help of a financial advisor.)
