Adani Ports shares slip 16% from all-time high; should you enter at current levels?

Shares of Adani Ports and Special Economic Zone Ltd (Adani Ports) on Thursday shed 0.18 per cent to settle at Rs 1,352.80. At this price, the stock has declined 15.87 per cent from its record high of Rs 1,607.95, a level seen earlier this week on June 3.

The port operator and logistics company has recorded 35.8 MMT of cargo volume in May 2024. Flagship port Mundra registered a key milestone of handling 17.6 MMT of cargo last month.

In addition, Abu Dhabi Ports Company has signed a joint venture (JV) with Adani Ports and East Harbour Terminals. Through this JV, all three parties have together acquired 95 per cent of Tanzania International Container Terminal Services. Total purchase consideration is valued at $39.5 million and the deal is expected to be completed by end of June.

Separately, Adani Ports is scheduled to be included in Sensex from June 24 as a part of the semi-annual reconstitution exercise of BSE indices. This inclusion will be a first for any Gautam Adani-led company to enter the 30-share BSE pack.

On the technical front, support on the counter could be seen at the Rs 1,150-1,125 zone. An analyst suggested accumulating it around Rs 1,250 level.

Osho Krishan, Senior Research Analyst - Technical & Derivatives at Angel One, said, "Adani Ports has seen a strong plunge descending the counter towards its consolidation zone. For now, Rs 1,150 is likely to cushion and a breach could disrupt the chart pattern. On the higher end, Rs 1,450-1,500 seems to showcase resilience in the near period."

Ravi Singh, Senior Vice-President (Retail Research) at Religare Broking, said, "One can consider buying the stock around Rs 1,250 level for an upside target of Rs 1,380. Keep stop loss placed at Rs 1,125."

The counter traded lower than the 5-day, 10-day and 20-day simple moving averages (SMAs) but higher than the 30-day, 50-, 100-, 150-day and 200-day SMAs. The counter's 14-day relative strength index (RSI) came at 49. A level below 30 is defined as oversold while a value above 70 is considered overbought.

The company's stock has a price-to-equity (P/E) ratio of 168.40 against a price-to-book (P/B) value of 9.97. Earnings per share (EPS) stood at 8.05 with a return on equity of 5.92.

As of March 2024, promoters held a 65.89 per cent stake in Adani Ports.