Most stocks of Adani group companies rose in early trade on Monday after Nomura said they are the most attractive among India Inc. The market–cap of Adani companies rose Rs 1,662. 6 crore to Rs 13.59 lakh crore as of 09:23 a.m.
Nomura also said that the Gautam Adani–led conglomerate will withstand the recent turmoil caused by the US Department of Justice indictment because its liquidity management improved.
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In late November, stocks of Adani Group companies slumped after it was reported that people associated with the group were charged under the US Foreign Corrupt Practices Act for bribery. The stocks started recovering after Adani Green Energy Ltd. clarified that the group's senior management is not charged under US FCPA.
After the company's clarification, ace investor Mark Mobius dismissed the DoJ indictment as frivolous expense. "My guess is that Donald Trump will come in and whoever he appoints to run the Justice Department will say, what are you guys doing? Sticking your nose into Indian businesses? Spending all this money on a trial which probably won't go anywhere?" he told IANS.
Even in case Adani promoters are found guilty, the size of potential penalty is manageable, given it is up to three times the value of the bribe, Nomura said. For Azure's management, the size of penalty could also consider the cash flow/operating profile of the affected projects, which could indicate a smaller amount, the brokerage said.
New Delhi Television Ltd. was leading gains among other Adani group stocks. It rose as much as 1.75% to Rs 177.40 apiece.
Adani Power Ltd. share price rose as much as 1.50% to Rs 544.15 apiece.
Adani Wilmar Ltd. stock rose the least, compared to peers to become the worst performing stock at open. It rose 0.53% to Rs 314.50 apiece.
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