Adani Wilmar bucks weak trend in group companies; surges 5% post Q3 results

The stock of Adani Wilmar has recovered 9 per cent from its intra-day low of Rs 405.10, lifted by heavy volume. In the past three days, it has bounced back 16 per cent

Shares of Adani Wilmar (AWL) were up 5 per cent to Rs 405.10 on the BSE in Thursday's intra-day trade after the Adani group's edible oil company reported 15 per cent year-on-year (YoY) growth in standalone profit after tax at Rs 277 crore in December quarter (Q3FY23).

The stock has recovered 9 per cent from its intra-day low of Rs 405.10. In the past three days, it has bounced back 16 per cent from a level of Rs 380.40 touched on Monday, February 6. Prior to that, the market price of AWL had tanked 34 per cent since January 24.

At 11:14 am, AWL was trading 4.5 per cent higher at Rs 438, as compared to 0.06 per cent rise in the S&P BSE Sensex. The average trading volumes on the counter jumped over three-fold today with a combined 13.6 million equity shares having changed hands on the counter on the NSE and BSE.

However, other shares of Gautam Adani group companies remained under pressure as they fell up to 20 per cent in the intra-day trade. The fresh sell-off comes after index provider MSCI said that it will review free float status of the listed group companies.

Meawhile, in Q3FY23, AWL recorded 16 per cent volume growth of 1.4 million MT and 7 per cent revenue growth to Rs 14,714 crore. Standalone earnings before interest, depreciation, tax and amortization (Ebitda) jumped 23 per cent YoY at Rs 623 crore and Ebitda per tonne improved to Rs 4,416 from Rs 4,190 in Q3FY22.

The strong volume growth achieved during the quarter was on the back of the large opportunity available in the packaged food industry, well supported by our portfolio of premium and popular brands, pan-India distribution, and manufacturing facilities across the length and breadth of the country, AWL said.

The quarter also saw macro tailwinds in the form of strong demand on the back of festivities and weddings, gradual recovery in rural markets and a bumper kharif crop. The Company continues to stay focused on increasing the direct reach to retail outlets and expanding its manufacturing capacity, both organically and inorganically, AWL said.

However, increase in the benchmark rates during the year also increased the interest cost for the quarter and 9 months of FY23, resulting in lower profit before tax (PBT) per tonne in comparison to Ebitda per ton, the company said.

AWL, in its result notes, said that subsequent to the quarter ended December 31. 2022, a research report dated January 24, 2023 has been issued by a short seller based in United State of America (USA), wherein allegations have been made on certain governance and transactions matters involving some of the Adani group entities and it's shareholders. Adani group have denied the allegations through it's report dated January 29, 2023.

The management of the Group is confident that the research report has no bearing on Group's operations and it's financial results, AWL said.