On Tuesday, the stock ended at 5% upper circuit at ₹550.85 apiece. Its market cap is nearly ₹71,593 crore on BSE. The gains have been extended from Monday’s 5% upper circuit of ₹524.65 apiece.
Generally, an upper circuit in a stock means the highest possible price that the stock could trade at in a day.
It needs to be noted that, Adani Wilmar stock has snapped its 8-day losing streak from this Monday onward. The stock had shed nearly 24% on BSE from December 9th to 23rd. However, from December 26-27, the stock recovered some losses with an upside of more than 10%.
On Monday, for Adani Wilmar stock, Santosh Meena of Swastika Investmart said, “If it manages to trade above the ₹ ₹530 level, then we can expect a move towards the ₹600-620 zone.”
Adani Wilmar launched its IPO from January 27th to 31st, and the issue received an oversubscription of 17.37 times on the last day. The company had fixed a price band of ₹218-230 per share.
Adani Wilmar listed on stock exchanges on February 8th at a discount compared to its IPO issue price. On BSE, Adani Wilmar debuted at ₹221 per share, while on NSE, the stock was listed at ₹227 per share. Both were at a discount compared to the IPO price of ₹230 per share.
However, Adani Wilmar picked up significant momentum right after its listing day. The stock has continued to hit the upper circuit on multiple occasions since.
From its listing price on BSE, the stock has now skyrocketed by 149.25% to date. While the stock has climbed by 139.5% from the IPO issue price.
Adani Wilmar has also become the best-performing IPO in 2022 post-listing.
As per BSE data, excluding SME IPOs, somewhat 11 companies have risen by more than ₹100 from their IPO issue price. In percentage terms, post listing, Adani Wilmar has given the highest returns compared to others.
Post listing, Adani Wilmar has climbed by 139.50%, while Hariom Pipe Industries and Venus Pipes & Tubes followed with gains of around 128% and 120% respectively compared to their IPO issue price. These three are top-performing IPOs in 2022 to date after listing.
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In September 2022 quarter, despite a challenging external environment, Adani Wilmar recorded strong volume growth in Q2FY23 riding on the back of growth in the food & FMCG segment and industry essentials. The total volumes of Adani Wilmar stood at 1.32 million metric tonnes rising by 9% from 1.21 MMT in Q2FY22. In segment-wise performance, Adani Wilmar registered a marginal decline in volumes of edible oils to 0.82 MMT versus 0.83 MMT in Q2FY22. However, the food & FMCG segment was the star performer with a growth of 41% in volumes to 0.22 MMT versus 0.16 MMT, also industry essentials posted 22% growth to 0.28 MMT against 0.23 MMT in Q2FY22.
In its financial audit report, Adani Wilmar stated that the Q2FY23 quarter saw multiple challenges in consumer demand with several macro headwinds in the form of high inflation, rising interest rates, delayed monsoons, and tepid rural demand.
Also, the company witnessed multiple headwinds on the margin front, with the high volatility in edible oil prices, allotment of lower TRQ (Tariff Rate Quota), and inflation impact on their operating expenses.
However, Adani Wilmar expects to take its food & FMCG segment volumes share to 30% over the next few years from 16% in Q2FY23.
Overall, the company posted revenue of ₹14,209 crore in Q2FY23 up by 5% yoy, on the other hand, EBITDA and PAT came in at ₹313 crore and ₹49 crore declining by 31% yoy and 73% yoy respectively. In the first six months of FY23, the company’s revenue is up 16% yoy to ₹28,986 crore, but PAT is down by 32% yoy to ₹242 crore.
In the near term, Adani Wilmar sees positive signs of recovery going forward in the edible oils business for H2FY23, with softening of commodity prices and the recent uptick in demand
on the back of festivities and weddings. Also, it had stated that new wheat flour of 500 Tonnes per day to become operational by Q3FY23.
Hence, Adani Wilmar had stated that they expect better demand in edible oils in Q3FY23, while Food & FMCG to continue leading the growth story. Overall, festivities and weddings are expected to drive the overall growth of the company in the third quarter of FY23.
Adani Wilmar is among the few large FMCG food companies in India to offer most of the essential kitchen commodities for Indian consumers, including edible oil, wheat flour, rice, pulses, and sugar.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.
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