DO YOU KNOW?

The Shares of debt ridden companies should continue to do well as the new scheme proposed by the RBI will ease debt repayment period and ease the capital structure.

The RBI lifeline states that debt can be classified into ‘sustainable’ and ‘unsustainable’ parts. The former will be serviced by existing cash flows, while the unsustainable debt will be converted into equity or convertible debt. Accounts that are worth more than Rs.500 crore would be eligible for the new scheme.

Photo: Business Standard

Also, the rates at which the Gautam Adani-promoted Adani Group bagged land from the Narendra Modi-led Gujarat government for its port and special economic zone (SEZ) project — between Re 1 and Rs 32 per square metre — were much lower than other companies that set up units in the state. Concessional pricing apart, the group did not face land acquisition hurdles, as the state allotted non-agricultural government land for Adani Port and Special Economic Zone (APSEZ), the country’s largest multi-product SEZ spread across 15,946.32 acres (6,456 hectares) in Kutch district’s Mundra block.

Photo: Business Standard

Meanwhile, while the shares of JP Group companies and Unitech Ltd (Rs.8.10) gave huge returns in the short term, the Adani Group is yet to pick up steam. Besides, you can see from figure on the left, that Adani Enterprise Ltd has better D/E ratio, than the J P Associates Ltd.

Earlier there were even media reports that Mr.Prakash Javadekar, has waived a fine of Rs 200 crore fine for environmental fine to Adani Enterprises.

Therefore, buy the shares of Adani Enterprises Ltd at Rs.82 82.30, T: Rs.88-91-99, SL: Rs.78.

Once the shares of this group starts moving with full steam, Adani Enterprise Ltd could even cross Rs.100. Adani Ports and SEZ Ltd recommended earlier already gave good returns to the investors, over a short term.

Moreover, Adani Enterprises Ltd is being recommended in this blog, since a long time. And those who have already purchased it on my earlier recommendations, are by now sitting with healthy profits.