Adani Group stocks rule in post-covid returns league table


A year ago, the coronavirus pandemic had caused mayhem on Dalal Street. With the Nifty 200 index declining as much as 37% from its peak in February 2020, investors were fleeing as if it was the end of the world. But as they say, fortune favours the brave. Investors who bought stocks a year ago have made great returns.

The Nifty 200 index has risen 97% in the past year. Barring Yes Bank and Rajesh Exports, investors could have blindly picked any stock within the top 200 by market capitalization, and made decent returns.

Leading the pack was the Adani Group, with shares of Adani Green Energy Ltd, Adani Total Gas Ltd and Adani Enterprises Ltd rallying 825%, 818% and 719% respectively in the past year. These were the top three gainers among the top 200 stocks by market capitalization.

Tata Motors came fourth with returns of 358%. Two other Adani group firms made it to the top ten list as well.

In fact, a basket of these five Adani group stocks generated returns of 488% in the past year, beating the returns of the next best in the list, Tata Motors. The stellar performance of the group’s stocks comes alongside its rapid expansion across ports, airports, gas distribution and other businesses.

Among other gainers, surprisingly, shares of Cholamandalam Investment & Finance Ltd (CIFC) have rallied by nearly 320%. Delayed payments of loan instalments, and hence an increase in bad loans was seen as a key threat for non-banking financial companies. But as analysts at Motilal Oswal said, “Contrary to our expectations, CIFC has seen a quick turnaround in terms of both growth and asset quality. Disbursement performance has been superior v/s peers, while collection efficiency (CE) has consistently been 100%+ for the past few months.”

From the commodities space, Hindalco Industries Ltd and JSW Steel have made it to the top 10 gainers list. These stocks have surged more than 250% in the last one year.

It is worth mentioning that a company like Vodafone Idea Ltd, which was on the verge of bankruptcy, has made it to the top 15 gainers on the bet that it may survive after all. A year ago, few gave it a chance of survival, with the stock languishing around Rs3 a piece. The stock has risen 217% in the past year.

Note that even among the bottom 10 stocks, firms such as Pfizer India Ltd, Gillette India Ltd, Akzo Nobel India Ltd and Alkem Laboratories posted returns of 15-20% in the last one year. Among stocks which gave single digit returns of 6-9% were WABCO India Ltd, Punjab National Bank Ltd and Coal India Ltd.

This means even if one would have blindly invested in these stocks, they would have made higher returns than a fixed deposit. Even shares of Interglobe Aviation Ltd, from one of the worst affected sectors owing to the pandemic, have doubled in the past year. Shares of Indian Hotels rose by over 50%.

Only shares of Yes Bank Ltd and gems and jewellery designer Rajesh Exports Ltd have fared very poorly, falling around 63% and 14% respectively. The cash-strapped Yes Bank Ltd had to be bailed out by a few other banks, which added to the downward pressure on the stock. Analysts say, but for the boom in the equity markets, investors in the Yes Bank stock would have been in a far worse position.


News Source:- Livemint

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