Adani Group Stocks Fall Up To 4 Per Cent - Here's Why

Shares of Adani Group companies fell as much as 4 per cent on Friday 14 after Adani Green Energy announced that it has withdrawn from a renewable energy wind energy project and two transmission projects in Sri Lanka.

The biggest loser among the group stocks was Adani Energy Solution, slipping 4.2 per cent from the previous close to hit an intraday low of Rs 712.56 apiece, as of 1 PM. Following it were Adani Enterprises, which cracked 3.7 per cent to Rs 2,161.20 apiece and Adani Green Energy, which declined 3.6 per cent to Rs 881.05 per share.

Adani Ports, Adani Total Gas, Adani Power, Adani Wilmar, Ambuja Cement, ACC, NDTV, and Sanghi Industries fell in the range of 2 to 3.5 per cent each.

Exchanges had sought clarification from Adani Green regarding a report that appeared in The Economic Times, claiming the withdrawal of the proposed projects.

“Adani Green Energy shares surged 3 per cent to Rs 946 in Thursday's intraday trade on BSE following reports that the company is withdrawing from its proposed wind power generation and transmission project in Sri Lanka, easing concerns over the project's viability,” the report had said.

As per the report, Sri Lanka had initiated discussions with the Adani Group to renegotiate the cost of power from the projects, which were estimated to cost $1 billion.

"It was learnt that another Cabinet appointed negotiations committee and Project Committee would be constituted to renegotiate the project proposal," Adani Green said in a letter addressed to the chairman of Sri Lanka's Board of Investment, according to Reuters.

"This aspect was deliberated at the Board of our company and it was decided that while the company fully respects the sovereign rights of Sri Lanka and its choices, it would respectfully withdraw from the said project," the letter, dated February 12, stated.

In an exchange filing, dated February 13, Adani Green clarified, “A subsidiary of the company had in past expressed its interest to set up certain wind power projects and its associated transmission infrastructure projects in Sri Lanka and had undertaken certain studies for the same. No definitive agreement was executed by the Company or its subsidiary. We have now respectfully withdrawn from further engagement for these projects in Sri Lanka.”

The company, however, added, “We continue to remain committed to Sri Lanka and are open to future collaboration if the Government of Sri Lanka so desires.”