Adani Wilmar Share Price: Promoter stake sale reports send the stock lower by nearly 5%

Shares of Adani Wilmar Ltd. dropped nearly 5 percent in trade on Wednesday, while those of Adani Enterprises Ltd. were trading flat after a news report said that the Gautam Adani-controlled conglomerate is considering selling its stake in the joint venture with Wilmar International Ltd.

According to a Bloomberg report, Adani Enterprises has been considering the sale of its 44 percent stake in Adani Wilmar for a few months now. At the current share price levels, Adani’s shares in the joint venture are worth about $2.7 billion, the report added.

The stake sale should free up capital for the core business of Adani Enterprises. Although Gautam Adani and his family may retain a minority stake in a personal capacity, the report said, quoting people familiar with the matter.

In response, Adani Wilmar said that it will not be able to comment on media speculation and rumours and it would be inappropriate on their part to do so.

Adani Wilmar – a 50:50 joint venture between the Adani Group and Singapore's Wilmar Group – made its debut on stock exchanges in February 2022, raising about Rs 3,600 crore.

The stock had listed at a premium of over 15 percent over the issue price of Rs 230 and had more than doubled to hit its 52-week high in September 2022.

But since then, the share price has been in a downtrend and has more than halved from that peak. Key factors behind this can be the Hindenburg report on the Adani group and the company's own financial performance.

For the recently concluded June 2023 quarter, Adani Wilmar reported a 25 percent year-on-year volume growth during the first quarter on account of robust consumer demand in edible oils and foods and a favourable base effect. However, it reported a 15 percent year-on-year decline in sales due to a sharp drop in the prices of edible oil. The FMCG segment, however, recorded a revenue growth of over 30 percent year-on-year during the June quarter.

Shares of Adani Wilmar are off the opening lows, currently trading 3.1 percent lower at Rs 381.