Hindenburg report may not hurt Adani Enterprises FPO, says InGovern

Adani Enterprises’ follow-on public offer (FPO), which kicked off on Friday, may not be impacted by Hindenburg Research's report, said InGovern Research Services.

It noted that anchor book has already been oversubscribed on January 25, "given that the objective of many of the long-term investors would be to hold the stock for many years." There could, however, be some sentimental hit among retail investors, InGovern Research Services said. 

Adani Enterprises finalised allocation of 1,82,68,925 FPO shares, in aggregate, to anchor Investors at Rs 3,276 apiece, of which application bid amount of Rs 1,638 per FPO share has been paid by anchor investors. Maybank Securities, Abu Dhabi Investment Authority, Société Générale, LIC, SBI Life Insurance Company, HDFC Life Insurance Company and Morgan Stanley Asia are some of the anchor investors.

In the past few years, proxy advisory firms in India have recommended that investors vote against many proposals placed by Adani group companies, it said.

"However, these recommendations by proxy advisory firms are preceded by discussions with the companies and with comments from the company. Else, just a one-sided communication distorts opinions in the market," InGovern Research Services.

InGovern said the Adani group companies should see this moment as an opportunity for greater investor engagement of all classes of investors.

Sushil Finance in a January 25 note said valuation does not seems attractive after a 100 per cent rally in the past one year. It said the issue price was at 7-10 per cent discount of prevailing price. This brokerage has a 'neutral view' on the issue.

Ashika Stock broking has a subscribe rating to the issue as "it is a nation building group and it is foraying into sunrise sector that is green hydrogen that has immense growth opportunity."

The Rs 20,000 crore FPO is being sold in Rs 3,112–3,276 price band. It would conclude on January 31. The basis of allotment is likely by February 3, unblocking of funds by February 4, credit of shares to demat account by February 5 and the listing of its shares is likely by February 8.
 

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