In the tumultuous world of stock markets, where uncertainty often reigns supreme, making the right investment calls requires a blend of foresight, courage, and a contrarian mindset. Rajiv Jain, the chairman and CIO of GQG Partners, exemplified these qualities when his firm made a bold bet on Adani Group stocks, just as the conglomerate faced a storm of controversy.
A year ago, Adani Group found itself in the crosshairs of a damning report by Hindenburg Research, sending shockwaves through the investment community. However, while many investors fled, Rajiv Jain saw an opportunity.
Against the backdrop of uncertainty, GQG Partners took a contrarian stance and made a significant investment of over Rs 15,000 crore in Adani Group companies. This bet has proven to be incredibly lucrative, with the market value of GQG’s holdings more than doubling in just a year.
| Company | 1-Year Returns (%) | CMP (Rs) |
| Adani Enterprises | 120 | 3,126.00 |
| Adani Ports and SEZ | 124 | 1,342.20 |
| Adani Energy Solutions | 65 | 1,044.15 |
| Adani Green Energy | 266 | 1,866.10 |
| Adani Power | 249 | 533.95 |
| Ambuja Cements | 76 | 607.55 |
Jain expressed his confidence in Adani Group’s long-term growth prospects, highlighting the pivotal role the conglomerate plays in advancing India’s economy and energy infrastructure. This vote of confidence was further reinforced by GQG’s additional investments in Adani Enterprises, Adani Green Energy, and Ambuja Cements.
Despite facing regulatory scrutiny and ongoing investigations, Adani Group continued its efforts to deleverage its balance sheet and reduce debt, which ultimately contributed to a strong recovery in its stocks. The group’s commitment to growth and profitability paid off, as evidenced by its highest-ever quarterly profit in the December quarter.
The Supreme Court’s ruling in favor of SEBI, affirming the regulator’s credibility and rejecting calls for transferring the probe to other investigative bodies, further bolstered investor confidence in Adani Group stocks. This, coupled with the conglomerate’s strong financial performance, drove a robust recovery in its stock prices.
| Company | Mar 23 Holding (%) | Mkt Value (Rs. crore) | Dec’23 Holding (%) | Current mkt value (Rs. crore) |
| Adani Enterprises | 1.43 | 5,460 | 2.95 | 10,446 |
| Adani Ports and SEZ | 1.82 | 5,282 | 3.76 | 10,412 |
| Adani Energy Solutions | 2.55 | 1,898 | 2.51 | 2,836 |
| Adani Green Energy | 1.42 | 2,806 | 3.68 | 10,796 |
| Adani Power | Nil | – | 1.33 | 2,715 |
| Ambuja Cements | Nil | – | 1.83 | 2,143 |
Rajiv Jain’s investment in Adani Group stocks serves as a testament to the value of contrarian investing and the importance of long-term vision in the stock market. GQG Partners’ success in doubling its investment in Adani Group is not just a financial triumph but also a testament to the resilience and growth potential of India’s corporate sector.
In conclusion, while the stock market can be volatile and unpredictable, investors who are willing to go against the grain and see the bigger picture can reap substantial rewards. Rajiv Jain’s contrarian bet on Adani Group stocks is a shining example of this principle in action.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.
Published on: Mar 27, 2024, 12:27 PM IST
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