Fraud and bribery allegations in the U.S shake Adani Group stocks: A deep dive into Q2FY25 performance

On Thursday, shares of the Adani Group declined sharply. Adani Energy Solutions, Adani Total Gas, Adani Green Energy, Adani Power, Adani Enterprises, Adani Ports, and Adani Wilmar on an intraday basis dropped by as much as 20%. This fall in share prices comes after their chairman Gautam Adani, a billionaire ranked among the world’s richest men, is facing indictment in New York due to allegations of his involvement in a multi-billion dollar bribery and fraud.

U.S. authorities claim Adani and seven others, including his nephew Sagar Adani, paid $265 million (₹2,237.41 crore) in bribes to Indian officials for contracts tied to a $2 billion expected profit from the solar project. Prosecutors also allege that Adani Green Energy's former CEO, Vineet Jaain, helped raise $3 billion in loans and bonds by concealing this corruption.

After these allegations, the Adani Group released a statement on bribery charges saying the allegations are baseless. It said, “We are fully compliant with all laws, all possible legal recourse will be sought.”

This is the second serious allegation against the conglomerate after Hindenburg Research, in its report in early 2023, said that the group was involved "in a brazen stock manipulation and accounting fraud scheme" for decades.

Performance of Adani Group Stocks

ACC Ltd

Adani Group's cement unit ACC reported operating revenue of ₹4,614 crore for Q2FY25, the highest in five years. This revenue was up by 4% on a YoY basis, driven by higher trade sales volume and premium products. However, the company reported a 48.45% fall on a YoY basis in its consolidated net profit at ₹200 crore due to lower demand and near-decade-low cement prices.

Adani Energy Solutions

The company reported strong operating revenue of ₹6,184 crore in Q2FY25, up by 68% on a YoY basis. The consolidated net profit reached ₹674.96 crore jumped by 144.65%. This growth of the company was due to contributions from newly operationalised transmission assets, partial completion of lines at under-construction projects, and an increase in energy sales driven by strong demand growth in its distribution businesses in Mumbai and Mundra.

Adani Enterprises

Adani Enterprises reported a 664% YoY jump in Q2 FY25 consolidated net profit to ₹1,742 crore. The company's revenue from operations stood at ₹22,608, up 16% from Q2 FY24. This performance has been led by Adani New Industries Ltd (ANIL) and Adani Airport Holdings Ltd (AAHL) with their rapid growth in capacity additions and asset utilisation.

Adani Green Energy

In Q2 FY25, Adani Green Energy reported a 39% YoY jump in its consolidated net profit to ₹515 crore. The revenue from operations stood at ₹3,376 crore, up 30% on a YoY basis from Q2 FY24. The performance of the company was driven by significant greenfield capacity additions and robust operational efficiency. The stock price jumped in Q2 by 6.37% (July 1 to September 30).

Adani Ports

The country’s largest private port operator’s revenue from operations for Q2 FY25 stood at ₹7,067.02 crore, with a growth of 6.33% on a YoY basis. The company reported a net profit of ₹2,413 crore, up by 39.90% (YoY). The profit growth was due to an increase in the cargo volumes handled by the company and new capacity additions progress.

Adani Power

In Q2 FY25 quarterly results Adani Power's net profits fell 49% to ₹3,332 crore as income from non-core operations fell and expenses rose year-on-year. The company's revenue from operations increased by 2.6% to ₹13,339. In Q2 the company achieved capacity expansion milestones with the addition of 2,300 MW, bringing operational capacity to 17,550 MW by September 2024. Also, the company saw made significant reduction in debt per megawatt, with improved credit ratings

Adani Total Gas

In Q2 FY25, Adani Total Gas reported a 7% YoY gain on consolidated net profit at ₹186 crore. The revenue from operations in Q2FY25 was reported at ₹1,318 crore, 12% higher as compared to the same period last year. This performance was on account of higher volume and sales realisation.

Adani Wilmar

The company made a turnaround reporting a consolidated net profit of ₹311 crore for Q2 FY25 compared to a loss of ₹131 crore posted in Q2 FY24. Revenue from operations in Q2 FY25 was reported at ₹14,460 crore, an 18% increase from Q2 FY24.

Ambuja Cement

In Q2 FY25 the company reported a standalone net profit of ₹501 crore, which is a fall of 22% on a YoY basis from ₹644 crore reported in Q2 FY24 due to continued weak cement prices and sluggish demand. The revenue from operations increased 6% YoY to ₹4,213 crore.