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Adani Group Shares Weak; Adani Wilmar Shares Down 5%, PAT Down 56% YoY in Q4FY23

Adani Enterprise looking to sell its stake in the Mumbai-listed consumer staple joint venture with Wilmar International.

Shares of the Gautam Adani Group-owned company were weaker in intraday trade on Wednesday, falling 7% on the BSE after Adani Wilmar (AWL) reported a 56% drop in its standalone profit after tax (PAT) to Rs 98 crore for the March quarter (Q4FY23). The edible oil company posted a PAT of Rs 223 crore in the same period last year.

The company’s revenue fell 8% year-on-year to Rs 13,122 crore from Rs 14,230 crore in Q4FY22. Ebitda per tonne fell 30% to Rs 2,407 from Rs 3,425 a year earlier.

Differences in TRQ (Tariff Rate Quota) have put pressure on soyoil margins, AWL said. Edible oil prices also continued to decline in the fourth quarter, leading to high-cost inventories and mark-to-market (MTM) impacts in the income statement. It added that the impact was limited mainly by the company’s robust risk management processes.

 Branded sales in the edible oil segment rose 4% in the quarter amid healthy consumer demand amid weak edible oil prices. However, overall oil sales were dragged down by lower demand from the baking and frying industry.

The company’s wholly-owned subsidiary in Bangladesh posted a loss of Rs 12 crore in Q4FY23 and Rs 63 crore in FY23 due to government price caps on edible oils, local currency-related issues and the inability of counterparties to trade forex hedging.

Meanwhile, shares of Adani Enterprises, the flagship of Adani Group, fell 7% to Rs 1,786.10. Shares of Adani Power, Adani Green Energy, Adani Total Gas, Ambuja Cements and Adani Ports and Special Economic Zone were down 3-5%. In contrast, the S&P BSE Sensex was down 0.37% at 61,126 at 1:51 pm.

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