Adani Wilmar shares give 250% return in 3-month. Should you buy, hold or sale?
PremiumAdani Wilmar IPO had opened on 27 January 2022 at issue price band of ₹218 to ₹230
Adani Wilmar's share price has jumped over 250 per cent in just two months. Its stock price went up from ₹221 on 8 February 2022 to ₹803 on Tuesday. Adani Wilmar IPO had opened on 27 January 2022 at issue price band of ₹218 to ₹230.
The company had raised ₹3,600 crore through an initial public offering (IPO) at the beginning of this calendar year. Meanwhile, the market cap of Adani Wilmar hit ₹1 lakh crore.
Why the share price of Adani Wilmar is rocketing?
Santosh Meena, Head of Research, Swastika Investmart Ltd. said the Ukraine war has shot commodity prices higher worldwide, Ukraine being the largest exporter of oilseeds like sunflower, and soybean seeds have pushed the edible oil prices. The Indonesian palm oil export ban and Malaysian export tax will further squeeze the oil supply. This whole problem has skyrocketed edible oil prices in India, benefiting Edible Oil companies like Adani Wilmar. The company will have windfall gains via. Unsold inventory revaluation. Further, this situation will improve the overall margins for the company.
“Adani Wilmar shares are skyrocketing due to the recent rise in soya prices to record high. Now, recently Indonesia and Malaysia has banneed export of palm oil, which may further fuel demand for edible oil," said Anuj Gupta, Vice President — Research at IIFL Securities.
So, Adani Wilmar is expected to get margin benefit of the expected spike in raw material prices of edible oil and expected rise in edible oil prices, he added.
Adani Wilmar share: Should you buy, hold or sale?
Those who have Adani Wilmar shares in their portfolio are advised to maintain stop loss at ₹735 as it may go up to ₹900 to ₹935 levels in short term, said Anuj Gupta,
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The recent proposal to ban palm oil exports by Indonesia from April 28 will push the prices of edible oils higher.
Adani Wilmar is a joint venture company between Gautam Adani-led conglomerate Adani Group and Singapore's Wilmar Group.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.