Demerger of Adani Enterprises

The Ken published a story on Adani Enterprises’ FPO today. It’s a paywalled story, hence sharing the main talking points here:

• The further public offering announced by Adani Enterprises is a well-timed, strategic move with the stock price at record highs
• With the fresh equity issue, the company would hope to reduce its high leverage and increase public shareholding to silence critics
• But new investors could baulk at the sky-high valuation of the stock, driven by the huge rally in the past two-and-a-half years
• Adani Enterprises choosing the FPO route over a rights issue or a qualified institutional placement raises some tricky questions