Adani is 'too big to ignore' says this analyst, projecting a 50% upside for Enterprises

The note further says that the current valuation of Adani Enterprises does not reflect all the parts. Calling Adani Enterprises a "publicly-trading incubator," it said that this approach is most prudent as many of the current business segments will likely be demerged going forward.

Cantor believes that the lack of analyst coverage on Adani Enterprises has served as a hindrance to investor education for all Adani-named businesses. "We believe that much of what the investor community knows about Adani has come from a short report published in early 2023," the note said.

Based on the report, Adani has taken actions to reduce liquidity risk, improve governance and increase transparency, according to Cantor, who further said that Adani is "too big to ignore" as the country needs Adani as much as Adani needs the country.

Cantor's valuation is driven by three main businesses. First is the airports business, where the company owns eight airports, seven of which are operational and the Navi Mumbai International Airport, which is slated to be completed by the end of the year. The brokerage values the airports business at ₹1,622 per share.

Second is the roads business, which it values at ₹1,525 per share and lastly, the solar, wind and electrolyzers, which it values at ₹1,511 per share. A total of this comes up to ₹3,419 per share, which is 18% above Thursday's closing price.

"This means that shareholders, in our view, are effectively getting the other six businesses for free, which partially explains why shares are attractive at current levels," the note adds.

Shares of Adani Enterprises are nearing the pre-Hindenburg research report levels. On January 24, the stock had closed at ₹3,443, whereas the stock closed at ₹2,903 on Thursday.