I HOLD ADANI POWER OR SELL

Ans: First of all we need to understand the questions being asked by Hindenberg and try to evaluate whether the allegation made by them makes any sense. If anyone goes through the Hindenberg report than the allegations and questions asked can be bifurcated into below broad categories:

1) Violations of Exchange and listed rules
2) Dubious Intra- Party Transactions
3) Use of Shell companies outside india ( Mauritius) to manuipulate the stock price
4) Money laundering through private Adani companies in listed companies of Adani inorder to look Balance sheet good.
5) Inexperienced Chartered accountants to audit the companies.
6) Using stocks as collateral for debt.

Looking at Adani Power, there are few specific points to be noted:

1) Promotors increased the pledge quarter on quarter basis.
2) High debt on the balance sheet
3) Decline in Net profit with falling profit margin on QoQ

As a retail investor, one should do the due diligence based on the above points and then one must consider the decision of investing in the company.

Disclaimer: This is just for educational purpose and this should not be takne as advise for buy or sell.

Ans: I like adani Enterprises from these 3. CDSL is also a decent story.

Ans: post Hindenburg Report its difficult to comment on these stocks.

Ans: Decline in Net Profit with falling Profit Margin (QoQ)
Declining profits every quarter for the past 2 quarters
with Hidenburg report it has raised a red flag on all Adani companies. So exit.

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