Adani, Valuation and Share Prices

Post Hindenburg’s report, a kind of saga unfolded causing temporary chaos in the Indian security market and raising large numbers of questions relating to Adani Group ranging from financial reporting to stock price manipulations to corporate governance. But it becomes pertinent to ask whether those questions are relevant or not.

It is not that the Adani Group is beyond question. There are a large number of serious questions that should be asked and are being asked as well. However, a lot of people have suddenly woken up to ask questions relating to the valuations of the Adani Group stocks post-Hindenburg saga and the withdrawal of FPO by Adani Enterprises.

Valuation has always been a very subjective matter. The yardsticks of it keep on changing depending on the sector as well the time. The different valuation ratios that are used for investment assessment purposes are also marred by time constraints. The levels of these valuation ratios keep changing. The values which were considered to be aggressive a few years/decades back are now considered to be conservative mainly post the entry of private equity and venture capital firms in start-up activities.

Unlike the earlier times, today the market value of tangible and intangible assets is subjective and depends more on their use in the production and services of the firms than the book value of those assets. It was never such a case ever before and it is bound to change in future too.

This article focuses on the comparison of the stock performances as well as differences between the 52-week high and low prices of the five firms namely, Adani Enterprises, Meta Platforms Inc. (Facebook), Alphabet Inc. (Google), Inc. and Tesla Inc. in the last 1 year.

Current Price

1 Year Return (%)

52-week High

52-week Low

Fall in Prices (%)

Adani Enterprises






Tesla Inc.






Meta Platforms Inc.






Alphabet Inc.





42.0% Inc.






Adani Enterprises Prices are in INR and as on 13th Feb 23

Telsa, Meta, Alphabet and Amazon prices are in $ and as in 10th Feb 23

Based on the fall in the prices of the five stocks, it can be said that there is not much difference. Apart from Alphabet Inc., all the firms have witnessed a fall of more than 50% in their stock prices. However, there are two differences. First, the fall in the prices of the stocks of Adani Enterprises was steeper than other companies; second, Adani Enterprises is the only firm which has provided a positive return in the last 1 year.

There is no doubt that it is a very simplistic comparison and hardly serves any purpose. But this comparison is aimed to point towards the stark differences in the way different stakeholders in the two countries are reacting to changes in the stock prices.No one in the USA is demanding a Federal investigation against Amazon, Google, Facebook and Tesla. For them, it is stock price volatility and market dynamics. But in India, different stakeholders including politicians, journalists and many more are demanding Joint Parliamentary Committee (JPC) investigations against the Adani Group. However, it is relieving to see that the regulators and the market are behaving with maturity and not being carried by the heat of the moment.

I am sure that someone will come out to say that all the firms except Adani Group are technology firms and their valuation is like that. And Adani Group firms not being in technology cannot enjoy such high valuations. That is alright but it should also be noted that Adani Group companies are having physical assets which are generating cash and most of the assets are expected will generate huge businesses for Adani Group in future as India grows. 

Rajeev K. Upadhyay

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