Adani Enterprises soars 12%; mining arm gets LoI for Odisha Bauxite block

Shares of Adani Enterprises soared 12 per cent to Rs 1,532.85 on the BSE in Wednesday’s intra-day trade, extending its previous day’s gain, on receipt of Letter of intent (LoI) in respect of Kutrumali bauxite block in Odisha. In past two days, the stock of Adani group flagship firm has rallied 28 per cent. While, from Tuesday’s low, the stock has galloped over 39 per cent.

Adani Enterprises on Tuesday said its arm Mundra Aluminium (MAL) has been declared as the preferred bidder for the Kutrumali bauxite block by the Odisha government.

MAL is a wholly-owned subsidiary of Adani Enterprises, incorporated with an objective of carrying out the business of mining, refining, smelting, development, production and operations of bauxite, alumina and aluminium.

“We are pleased to inform that based on the outcome of the auction proceedings, Mundra Aluminium has been declared the "preferred bidder" and subsequently, a Letter of Intent dated February 27 has been issued by the Government of Odisha in respect of the following mineral block in Odisha," Adani Enterprises said in an exchange filing.

The Kutrumali Bauxite block is located in the Kalahandi and Rayagada districts of Odisha and has about 128 million tonnes of bauxite and other ores.

On August 12, 2022, Adani Enterprises had said that the Adani group will invest Rs 57,575 crore in the state of Odisha. The High-Level Clearance Authority (HLCA) of the Govt of Odisha, headed by Chief Minister Naveen Patnaik, approved the Adani Group’s proposal to set up two projects – a 4 MMTPA Integrated Alumina Refinery and a 30 MMTPA Iron Ore (Value Addition) Project.

The 4 MMTPA Integrated Alumina Refinery, to be set up in the vicinity of potential bauxite reserves or operational mines, will produce Smelter Grade (Metallurgical Grade) Alumina, which will help India move towards import substitution. The 30 MMTPA Iron Ore (Value Addition) Project will comprise an iron ore beneficiation plant producing iron ore concentrate, a slurry pipeline for iron ore concentrate slurry and a dewatering/filtration & pellet plant to produce filter cake and pellet.

The iron ore beneficiation plant will be located in Deojhar, in northern Odisha’s Keonjhar district, while the pellet plant is to be set up in Dhamra, in the adjoining Bhadrak district. The slurry pipeline will run along the utility corridor of the roads between Deojhar and Dhamra, the company had said.

However, despite of past two day’s rally, the stock price of Adani Enterprises has tanked as much as 63 per cent from its all-time high of Rs 4,189.55, touched on December 21, 2022.