Adani flagship Adani Enterprises' net profit for Q1 more than doubles

The flagship company of the Adani group- Adani Enterprises' net profit for the quarter ending June 30 more than doubled on the back of strong operational performance from its emerging businesses of airports and green energy. 

Consolidated net profit after tax rose by 116% to Rs 14.58 billion ( $173 million) while total income climbed by 13% to Rs 260.67 billion.

The company beat Bloomberg estimates of Rs 11.64 billion PAT by more than 25%.

The company said its emerging core infra businesses comprising the ANIL Ecosystem, airports and roads have significantly improved their operational performance and the contribution of these businesses to the overall EBITDA has now increased to 62% in the quarter under consideration compared to 45% in the same quarter last year. 

Strong performance by Adani's green energy business

The ANIL Ecosystem's solar manufacturing and wind turbine businesses recorded the highest ever EBIDTA of Rs 16.42 billion, increasing 3.6 times compared to the same quarter last year. 

It now contributes 38% to the total EBITDA. 

The conglomerate has been expanding its new energy business, through more investments in renewable energy. 

Module sales under its solar business increased by 125% on a year-on-year basis at 1379 MW, with exports increasing by 109% and domestic sales increasing by 151%.

Gautam Adani, chairman of the Adani group, said,

Meanwhile, the company's mainstay coal trading business revenue fell 28% to 107.94 billion rupees on lower coal prices.

FMCG food business demerged to Adani Wilmar

Adani Enterprises also announced the demerger of the food FMCG business to Adani Wilmar, along with AEL's strategic investment in Adani Commodities.

The company said the food FMCG business had become "self-sustained, performing well and is poised for further growth under AWL".

It said the arrangement will not only unlock value for shareholders but also allow focused strategy for sustainable growth in its incubating businesses. 

Market movement and recovery from the Hindenburg crisis

The share price of Adani Enterprises jumped 1.57% on the back of the earnings announcement. 

In January 2023, Hindenburg Research, a US-based short-seller released a critical report accusing the Adani Group of fraud and stock manipulation.

This report had a significant impact on the share prices of Adani Group companies including Adani Enterprises.

While the Adani Group has denied the allegations, by early February 2023, the broader group had lost around $68 billion in market value, affecting investor sentiment across its listed companies​

In May this year, Adani Enterprises bounced back to levels last seen in January 2023. In the last one year, its share price has gained 30%