Adani Enterprises stock price down after CARE downgrades outlook

9 Mar 2023 , 01:12 AM

CARE Ratings has downgraded the outlook on Adani Enterprises from stable to negative, citing ongoing regulatory and legal scrutiny.

Following this development, Adani Enterprises’ stock slipped about 6.5% to Rs1,905.35 apiece in Thursday’s trading session.

CARE stated in a report that the reason for the negative outlook is due to the anticipation of a decrease in the Adani Group’s financial flexibility if any unfavourable outcome or observations arise from the ongoing regulatory and legal scrutiny directed by the Honourable Supreme Court of India regarding various accusations against Adani group companies.

On the other hand, if the result is deemed acceptable, the financial flexibility of the Adani group could potentially be reinstated. This may prompt a reconsideration of the outlook, with a possible revision to stable.

Over the course of the past seven days, Adani stocks have experienced a streak of triumph as a result of a surge in favorable news, specifically concerning share prepayment and the selling off of stakes.

According to CARE’s evaluation, while the company possesses notable strengths, such as its diversification across various large-scale projects, the potential risk associated with incubation in unfamiliar areas without prior experience, substantial capital expenditures projected in the airport segment, and continued reliance on subcontractors for executing road projects all serve to offset these strengths.

At around 1.15 PM, Adani Enterprises was trading 4.70% lower at Rs1,943.75 apiece against the previous close of Rs2,039.65 on NSE.

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