Adani Stocks At Pre-Hindenburg Days, M-Cap Hits Rs 20 Lakh Cr, Shares Up 7-19%: 6 Gautam Adani Stocks To BUY!

Amidst record high rally on June 3 ahead of election poll results, Adani Group-led stocks witnessed a massive buying sentiment taking its total market cap to even higher than the pre-Hindenburg level. That's not all, Adani stocks gave from 7% to 19% returns in a single day. Brokerages are highly optimistic about the port-to-energy empire due to its capacity expansion spree, huge FY25 CAPEX, fresh funding from global investors and much more. Some analysts even say that Adani Group's business prospects are key for self-reliant India.

Adani Stocks Rides On Bulls:

5 out of 10 Adani stocks touched a new 52-week high on June 3.

Adani Power witnessed the most buying among its siblings on June 3, with gains of 18.5% and a new 52-week high of Rs 896.75 apiece. Meanwhile, the group's flagship Adani Enterprises rallied by 9.7% to hit a new 52-week high of Rs 3,743. Cash-cow Adani Ports also witnessed the stellar performance, rising over 11.8% to touch a new 1-year high of Rs 1,607.95.

Adani Green was another stock to touch a new high of Rs 2,173.65 apiece with an overall jump of 13.5%, followed by Ambuja Cements which climbed 6.7% to hit a new high of Rs 676.65 apiece.

Among other stocks, Adani Energy Solutions surged by 11.23%, while Adani Total Gas gained by 15.3%, Adani Wilmar soared by 7.34%, ACC zoomed by 6.7%, and NDTV stock jumped by 10.85%.

Together, Adani Group's market cap jumped to Rs 20.01 lakh crore on June 3, even higher than Rs 19.20 lakh crore on the day when US short seller Hindenburg's report led to a shockwave in the market with panic selling in Adani stocks. Hindenburg's report was released on January 24, 2023, which led to a market rout of over 100 billion dollars in the Gautam Adani conglomerate.

Why Adani Stocks Are Rallying?

The expansion in key businesses by the Group has led brokerages to have a bullish outlook in Adani stocks.

In its latest report, Jefferies said, Adani Group's MCap was hit by a short seller report in late FY23. During FY24,
the group focused on containing debt and reducing the founders' share pledge. Total group EBITDA grew 40% YoY in FY24 (5yr CAGR:+27%), the group raised fresh funds from equity/debt/strategic investors, the promoter increased stake in group Cos and group Mcap rebounded.

Jefferies added, "The group is back on an expansion spree and eyeing USD90bn capex over the next decade. In the report, we discuss the group's FY24 perf and way ahead."

Going ahead, Jefferies pointed out that Adani Enterprises is scaling its captive manufacturing capacity towards
starting Green Hydrogen production by FY27; Navi Mumbai Airport appears likely to commission by 4QFY25; Data Center projects are scaling up. Adani Cement: Mgmt continues to guide the doubling of Cement capacity and scale-up in unit EBITDA to Industry Rs1450-1500/T by FY28.

Further, Adani Ports recently published its 5-year business roadmap, targeting 18% EBITDA CAGR in FY24-29E. Ports EBITDA is expected to rise at 16% CAGR led by expansion and ramp-up with the company targeting 1bnt cargo volume by 2030 (15% CAGR). Adani Green raised its 2030 power capacity target from 45 GW to 50 GW now including 5GW Pumped Hydro. Adani Total Gas plans to grow new business segments including the LNG station network for the transport and mining sector and EV charging facilities. Adani Wilmar: Focus on distribution expansion, ramping alternate channels and improving the mix of premium brands, it said.

Which Adani Stocks To Buy?

1. Adani Enterprises:

Jefferies said, "AEL's FY24 EBITDA grew 32% YoY to Rs132bn, with 5.6x YoY/45% YoY growth in New Energy/Airport
segment EBITDA. 4Q EBITDA growth was tepid at an 8% YoY decline (though a beat on est) on a high base related to road segment EBITDA recognition last year. Leverage (Net Debt/EBITDA) remained contained at ~3x FY24 and Co eyes an increase in Capex over the next years to scale up new businesses with net debt/EBITDA remaining contained below ~5x. We maintain est and BUY on the stock."

Also, as per Trendlyne data, the consensus recommendation from 2 analysts for Adani Enterprises Ltd. is STRONG BUY. The consensus has set the 1-year average target at Rs 4069 apiece, hinting 12% upside.

2. Adani Ports:

Jefferies also likes Adani Ports stock. It said, "Operationally, Adani Ports is continuing to move from strength to strength, with market share moving up to 27% from 14% in FY15 and expected to be 30%+ by FY26 27E. As core port EBITDA growth remains upward of double digits, backed by volumes, we remain positive on the stock. Our Rs1,640 PT is based on 16.5x EV/ EBITDA Sept. 2026E, broadly in-line with 16.4x mean since 2009."

HEM Securities has also reiterated a "BUY" rating on the stock and valued the stock at 23.9x FY26E earnings to arrive at the target of ₹1654.

3. Adani Energy Solutions:

This energy stock is Jefferies' third Adani pick. It said, "AESL's management believes in minimising volatility in its asset base across parameters: 1) debt is being refinanced and raised to match the life of the respective asset at a fixed rate as far as possible; 2) vendor back-to-back arrangements to limit the impact of commodity price changes as far as possible; and 3) land studies, as right of way over thousands of km are key for commissioning transmission projects. Our DCF-based PT of Rs1,365 (Sept. 2026E) factors in COE of 15%, long-term debt rate at 9% and a terminal growth of 5%."

4. Adani Wilmar:

As per Trendline, the consensus recommendation from 4 analysts for Adani Wilmar Ltd. is HOLD. The 1-year average target price is Rs 374.25.

5. ACC:

ICICI Securities in its report said, "Despite the choppy sector outlook, ACC appears a compelling bet given its attractive valuation of - i) volume growth visibility (from the imminent near-term ordering of 4mtpa clinker in South India, as per Q4FY24 earnings call guidance); ii) beneficiary of the INR 530/t cost saving target set by ACEM by FY28; iii) odds of eventual consolidation with parent ACEM (over the long term, in our view) and iv) strong balance sheet with healthy RoEs. We continue to value ACC at 13x FY26E EV/EBITDA (at par with its 10-year average multiple) and maintain BUY with TP of INR 3,272."

6. Ambuja Cement:

In its latest note, ICICI Direct said, "With a strong focus on increasing overall market share (through strategic
capacity expansion plans), further operational efficiencies and cash-rich balance sheet, we believe that Ambuja Cements' operational performance to improve substantially in the coming period. We expect revenue growth of
12.3% CAGR over FY24-26E, while EBITDA & PAT CAGR at 25.1% & 22.9% respectively over the same period."

It added, "We value FY26E consolidated EBITDA at 19x EV/EBITDA and adjusted the minorities (ACC & Sanghi) value. We recommend BUY on Ambuja Cements with a target price of ₹ 720 per share."

Adani Group is a diversified organisation in India comprising 10 publicly traded companies. It has created a world-class transport and utility infrastructure portfolio that has a pan-India presence. Over the years, Adani Group has positioned itself to be the market leader in its transport logistics and energy utility portfolio businesses focusing on large-scale infrastructure development in India with O&M practices benchmarked to global standards.