Among stocks that have gotten listed recently, out of them Adani Group’s Adani Wilmar Ltd. is an outlier. The firm has almost tripled since its debut while most newcomers are trading in the red. Adani Wilmar Shares, a joint venture between the group controlled by Asia’s richest person Gautam Adani and Singapore’s Wilmar International Ltd., have outperformed 121 Asian initial public offerings worth over $100 million this year, according to a Bloomberg report.
Adani Wilmar’s share price has been under consolidation phase for last one month. In last one month, it has tumbled near 21 per cent. However, the stock is one of the multibagger stocks in 2022 as it has delivered near 135 per cent return to its shareholders in 2022.
However, yesterday, the share price opened downside and went on to make an intraday low of Rs 631.65 per share levels, hitting the lower circuit on the third successive session. According to stock market experts, rising input costs and lowering of edible oil prices in the domestic market may continue to dictate edible oil maker stocks and hence one should avoid taking a fresh position in the scrip.
In the Adani Wilmar IPO, the Monetary Authority of Singapore and Nippon Life India were among the investors. The firm makes Fortune brand cooking oils, wheat flour, rice, pulses, sugar, and other food products. Stating the rationale behind the public offering, it would use part of the funds in the $486 million offering to expand facilities, repay loans and make strategic acquisitions.
Market analysts expect Adani Wilmar to continue to gain market share on account of its strong distribution network, diversified product portfolio, and market. “The company is expected to “continue to gain market share on account of strong distribution network, diversified product portfolio, market leadership in key categories, focus on rural market, new product launches and strong parentage,” said Vikrant Kashyap, an analyst at KR Choksey told Bloomberg.
Adani Wilmar, which paid off debt with funds from the IPO, gets “significant benefit” from its parents, Kashyap wrote in a note this month, which recommended the stock as accumulate. The note further mentioned that expected acquisitions will lead to a gain in market share. The company has recently announced the purchase of several brands, including the Kohinoor cooking brand for the India region.
Incorporated in 1999 as a joint venture between Adani Group and the Wilmar Group, Adani Wilmar Ltd (AWL) is an FMCG food company offering most of the essential kitchen commodities for Indian consumers, including edible oil, wheat flour, rice, pulses, and sugar. The company’s portfolio of products spans across 3 categories: (i) edible oil, (ii) packaged food and FMCG, and (iii) industry essentials.
Talking about the other Adani Group listed stocks, Adani Power Ltd., up more than 200 per cent this year, is the top performer among members of the S&P BSE 500 index. Elesewhere, Adani Green Energy Ltd., up 65 per cent year-to-date, is the fifth-best performer even as the firm has no analyst coverage. Overall, every Adani Group stock has been performing well.
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