Adani Wilmar shares dive 8% as AEL set to exit from JV; check analyst views & targets

Shares of Adani Wilmar Ltd tumbled during the trading session on Tuesday after Gautam Adani led conglomerate decided to exit the 25-year-old joint venture with Wilmar International in a deal worth around $2 billion. The company announced this through an exchange filing on Monday.

The proceeds from this sale will be used by Adani Enterprises Ltd (AEL), the flagship company of the Ahmedabad-based business house, for its core infrastructure platforms such as energy, utilities, transport and logistics. On the other hand, Singapore-based Wilmar is seeking strategic investors to replace Adani.

Following the announcement, shares of Adani Wilmar cracked 7.98 per cent to Rs 303.30 on Tuesday, with its total market capitalization falling below Rs 40,000 crore. The stock had settled at Rs 329.50 in the previous trading session on Monday. The stock has dropped 26 per cent from its 52-week high.

AEL plans to offload its nearly 44 per cent stake in Adani Wilmar (AWL) in two parts. It will first sell about 13 per cent stake to meet public shareholding norms, where the promoters currently hold 88 per cent of the company. Wilmar will acquire the remaining 31 per cent stake, which will increase its holding to nearly 75 per cent from current 44 per cent.

Brokerage firms have a mixed view on the stock following the announcement. Global brokerage JP Morgan remained underweight on the counter, while another foreign brokerage Investec is a slight positively on the Adani Group counter.

JP Morgan said that Adani Wilmar enjoys significant sourcing, supply chain and scale advantages. It believes that 40 times FY26E P/E adequately prices the franchise strength. It pegs edible oil business at 12 times EV/Ebitda and food business at 3 times EV/revenue. It remains underweight on the stock with a target price of Rs 320 on Adani Wilmar.

Investec said that single promoter ownership is a positive for the company and it expects the entire transaction to be completed within the given time of 12 months. The company has a stable and professional management and any changes in the board as unlikely, it said with a 'hold' rating and a target price of Rs 397 on the stock.