Is the Adani Group Good for long term stock investment?

Adani Group is actually a multinational conglomerate and its main headquarter is in Ahmedabad. It was founded by Gautam Adani in 1988. And it has diversified business which includes port management, electric power generation and transmission, renewable energy, mining, airport operations, natural gas, food processing and infrastructure.

Currently Adani group is generating over 20 billion dollars revenue annually.

As per some points, Adani group is not safe to invest in for short term as for now, here are some of the reasons that why adani group is not safe for short term investment -

1. The valuation of every adani’s share is very high and the P/E ratio is incredibly high, which is not good if you see for the short term investment.
2. Debt to Equity ratio is also very high for every adani’s share like adani enterprise debt to equity ration is 1.87, adani port is having 1.48, adani power is having 2.61 which is very high and almost every adani’s share debt to equity ratio is incredibly high, which is not a good sign, atleast for now.
3. Political relationships is one of the factor thats benefiting adani group for now as they are getting many projects from the government too, so if all this growth is depending upon the political reasons then you should know that government can change at any moment, so the benefits which adani group is grabbing now, there are probabilities that it can be change when there is a government change.
4. Fundamentals of adani group is not matching with the valuation what market is giving to them.Thier fundamentals are not that strong and the company’s growth depends alot upon the fundamentals of the company and the management of the company.

You need to wait till this bubble burst because it has to, and when this bubble burst then you need to perform SWOT analysis for it and should analyze other measures too before investing in adani group.

Some important measures that you need to take before investing are given below-

1.Strong Industry Tailwinds-

Firstly we need to find that particular company in which you want to invest is belongs to which category and you need to study and analyze that industry very well and if you get to know that yes this industry can boom in future or can grow several multiple times as of now. If the industry will grow then the company will automatically grow.

2.S.W.O.T Analysis-

SWOT Analysis needs to be done to have the better view of the company growth and operations. SWOT stands for Strength, Weakness, Opportunities and Threats. So we need to get the proper view of the company’s strength, what are the weakness and how company can overcome from that weakness, what are the opportunities for the company and what are the threats.

3.Capable Management -

Company’s management is one of the key factor that a whole company depends. If the company management have good decision maker and have the ability to overcome weakness and take benefits of the opportunities then no one can stop that company to grow in future.

4.Balance Sheet -

Through balance sheet you can check whether the company is in loss or in profit or how much cash in reserve they have and what type of expenses are there, all details will be available there. Company release their balance sheet in every 3 months when they declare their quarter result so at that time you can read all the information and then you can decide whether to go with the company or not.

5.Patience -

Last is patience, whether you hold a blue chip stock or a small cap stock, you need to show patience if you really want to create wealth in future.

Current latest news of Adani Group - Adani Acquires 29.18% stake in NDTV and launches an offer to buy more stake in NDTV.This is one of the biggest adani group news for now.

Note- If you dont know about stock market and wants to learn stock market basics you can always choose a stock market basic course in which you can learn all the basic details which you might need to know before you start your investment journey.

My name is Anubhav and i write articles on multiple topics. Thanks for showing support.