Adani Enterprises’ share price hit its new life-time high in the sixth straight session on Monday. The stock is up 81.35 per cent in last one year as compared to a 4.85 per cent jump in Nifty and a 4.43 per cent jump in the Nifty Media index. Adani Enterprises Ltd has gained around 16.7 per cent in the last one month.
Meanwhile, Nifty Media index of which Adani Enterprises Ltd is a constituent, has gained around 10.34 per cent in last one month and is currently quoting at 5094.1, up 1.08 per cent on the day. The volume in the stock stood at 7.44 lakh shares today, compared to the daily average of 12.33 lakh shares in the last one month.
According to exchange data, the stock traded at a price-to-earnings (P/E) multiple of 370.41 while the price-to-book ratio stood at 10.26. A higher P/E ratio shows that investors are willing to pay a higher price for per rupee earnings given by the stock because of better future growth expectations. The price-to-book value indicates the inherent value of a company and it reflects the price investors are ready to pay even for no growth in a business.
Financials
The company reported consolidated sales of Rs 25141.56 crore for the quarter ended 31-Mar-2022, up 32.58 per cent from the previous quarter’s Rs 18963.4 crore and up 83.66 per cent from the year-ago quarter’s Rs 13688.95 crore. Its net profit for the latest quarter stood at Rs 304.32 crore, up 30.08 per cent from the same quarter a year ago.
According to stock market experts, this Adani group stock has been rising after the rise in demand for electricity in this summer season leading to demand-supply constraints in the power sector. Adani Enterprises is expected to benefit from the better earnings from Adani Power and Adani Transmission and hence the stock has been hitting the upper circuit on a regular basis.
Recently global brokerage and research firm Jefferies has also reported that India’s power sector is all set to witness robust growth in the upcoming decade.
What Should Investors Do?
Santosh Meena, Head of Research, Swastika Investmart, said: “The counter is in a strong bullish momentum where it took support at 100-DMA and created a strong base followed by a minor pullback and now it is again resuming its momentum for a fresh all-time high. On the upside, the previous swing high of Rs 2,421 is an immediate hurdle then we can expect a rally towards Rs 2,500/2,770 levels. On the downside, the Rs 2,300-2,250 area has become a strong demand zone.
Manoj Dalmia founder and director-Proficient Equities Limited, said: “Adani Enterprises Ltd is quoting at Rs 2550, up 2.05 per cent on the NSE. The stock is forming higher high and lows as it had recently broken it previous swing high, we can expect target till Rs 2,757, stop loss at Rs 2,433 and entry at the current price.”
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