Adani Enterprises and Adani Ports & SEZ dragged the NSE Nifty 50 index down by 0.25% on Wednesday even as the BSE Sensex closed 150 points higher from the previous day. Since the 30 stocks that comprise BSE that do not include the Adani Group firms, despite the excessive turbulence and heightened volatility in the domestic equity markets as a result of the Union Budget 2023, the Sensex successfully pared its intraday losses, gaining almost 900 points from the day’s lows. Despite gaining intraday, Nifty closed 355.7 points lower from the day’s high as the Adani Group heavyweights continued to bleed.
Adani Enterprises snapped a two-day gaining streak, closing lower by 26.7% at Rs 2,179.75. The sharp fall in the share price comes a day after the Adani Enterprises FPO, with a floor price of Rs 3,112, was fully subscribed. The logistics company Adani Ports & SEZ tanked by 17.73% at Rs 504. The Adani Group firms hit their lower circuit multiple times intraday. The Adani Group companies continued their freefall following Budget 2023, since Bloomberg reports stated that Credit Suisse Group has stopped accepting Adani Group’s bonds as collateral for margin loans to its private banking clients.
The top five Sensex losers dragged the index down by 300 points, however its top gainers managed to offset the losses. Adani Enterprises, the top loser on the Nifty 50 index fell by 26.7% whereas Bajaj Finance, the top loser on the Sensex-30 dropped 5.65% in comparison. “A well-tuned budget … lifted optimism in the market; however, volatility sparked in the latter half as focus shifted back to the Adani saga,” said Vinod Nair, Head of Research at Geojit Financial Services.
“It was no different on the Budget day as markets once again were extremely volatile and Sensex gyrated nearly 2,000 points intra-day. However, at one point during the Budget presentation, Sensex had vaulted neary 1200 points but a rout in the Adani group stocks and nervousness ahead of the important Federal Reserve meet on interest rate punctured the rally and saw the indices end mixed,” Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities. “Broad market indices fell more as nervousness spread across the board as Adani Group stocks once again came under pressure,” added Deepak Jasani, Head of Retail Research, HDFC Securities.
The Adani Group came under fire from US forensic financial research firm Hindenburg Research, who alleged the multinational corporation engaged in money laundering, financial fraud, misuse of tax havens and stock market manipulation. Since the publication of the report, the listed Adani Group companies have seen a cumulative loss of over $60 billion.