Adani Enterprises (AEL) shares reflected a crash of 83% on the stock exchanges adjusting to the demerger of its port, power and transmission vertical. The stock ended at Rs 109.75 compared with Tuesday’s price of Rs 638.05 per share. In reality, the stock was down Rs 10.20 or 8.51% to its adjusted price of Rs 119.95 apiece on Tuesday.
All Adani group companies saw a spurt in volumes. Over 5.66 crore AEL shares exchanged hands on the BSE and NSE, up 5.77 times its average volume in the last five sessions and 16.65 times its 30-day average volume.
More than 3.77 crore Adani Power (APL) shares were traded, up 6.26 times its 5-day average volume and 8.12 times its 30-day average volume. Adani Ports & SEZ (APSEZ) volumes surged 5.69 times its 5-day average and 9.06 times its 30-day average volume. More than 2.56 crore shares exchanged hands on the exchanges.
AEL may be excluded from the BSE 100 and BSE 200 universe due to the restructuring.
Under the scheme of arrangement announced on January 30, 2015, AEL will transfer its ports business, including the assets and liabilities pertaining to Belekeri port, to APSEZ. In return, APSEZ will issue and allot new shares in the ratio 14,123 shares for every 10,000 AEL shares held by shareholders. The company has set June 4 as record date for demerger.
AEL will transfer the power operations assets and liabilities pertaining to the 40MW solar power project at Bitta village, in Kutch district of Gujarat to Adani Power (APL). Shareholders will receive 18,596 shares of APL for every 10,000 AEL shares.
AEL will transfer its power transmission business to an unlisted group firm, Adani Transmission, which will get listed on bourses soon. Once listed, the company will issue shares to Adani Enterprises in the ratio of 1:1.
The equity shares held by AEL in APL and APSEZ will stand cancelled pursuant to the scheme, the company had announced in January.
Brokerages have a constructive view on the stock. Two analyst have a ‘buy’ rating, while three recommend ‘hold’ while two others have a ‘sell’ rating, according to an analyst poll by Bloomberg.
IDFC Securities observed that Adani’s restructuring creates value for shareholders by eliminating hold-co discount on AEL’s stake in APSEZ and APL. “Listing for its transmission assets will also unlock value of Rs 3,300 crore equity invested besides giving it ability to expand its portfolio. Further upside in the APSEZ stock (based on our fair value) and listing of the transmission business would be key drivers going forward,” stated the IDFC note.
On the other hand, Morgan Stanley view AEL’s actual value at sub-Rs 100 apiece.
* Over 5.66 crore AEL shares exchanged hands on the BSE and NSE, up 16.65 times its 30-day average volume
* More than 3.77 crore Adani Power shares were traded, up 8.12 times its 30-day average volume
* Adani Ports & SEZ volumes surged 5.69 times its 5-day average and 9.06 times its 30-day average volume
* Most brokerages have a constructive view on the stock
* IDFC Securities says Adani’s restructuring creates value for shareholders by eliminating hold-co discount on AEL’s stake in APSEZ and APL
* But Morgan Stanley sees AEL’s actual value at sub-Rs 100 apiece