The Adani Group Solar System

JC Parets
February 10, 2021

The universe comprises several solar systems- big and small. Similarly, the market comprises of several conglomerates- big and small. One such conglomerate that we'd like to look at today is the Adani Group.

It is fit to call the Adani Group a solar system since there have been times in the past when these stocks have rallied despite a broader market correction. So where are these stocks headed and what is our view of the constituents of this group going forward?

Let's take a look at the charts.

We created an equally weighted custom index of the Adani Group constituents. It takes one cursory glance at this chart to see that this group has been on a tear since the dip in March 2020. With only minor corrections halting these stocks from time to time, the returns generated by this group have been handsome indeed.

Click on chart to enlarge view.

When we compare the returns of this group against the stock universe that we track, we see a similar outperformance.

Now let’s take a look at individual stocks and where they stand at present.

Adani Green has been the 'poster boy' of this group. Recovering from lows of 111, the stock has grown 9-fold since March 2020! Currently moving sideways, we are bullish only above the level of 1,015 with a target near 1,574. The trend remains up as long as the risk management level of 1,015 is not breached.

Adani Enterprise is another crowd-puller. Currently trading in no man's land, the price is headed towards its next target of 728. While pull-backs can be used as buying opportunities, a move above 728 could take it further towards 1,107. With only minor corrections, the indicator has remained firmly in a bullish momentum regime.

Adani Total Gas is up next. The stock is currently halting at the 261.8% Fibonacci retracement of the 2020 correction. But we know that the more times a level is tested, the more likely it is to be breached! We are bullish only above the level of 387, with a target near 579.

Adani Transmission is in a strong uptrend as well. The stock has just breached the overhead resistance level of 499. As long as the price remains above this level, we are bullish with a target of 716. Momentum is in a positive regime with price breaking out to new all-time highs.

Adani Ports seems like it's gearing up for the next leg of the rally. Price is knocking up against the resistance of 570. A sustained move above this level could take the price towards the target of 796.

Adani Power has been the underperformer of this group. The price has found it difficult to move past 54 and continues to trade below its 2020 highs despite the strong bull market that we are witnessing. Price has had two failed breakouts above 54.

Only a move above 65 could take the price towards its 2020 highs. But having said that, there are better candidates within this group itself that would act as better actionable ideas going forward.

 

This was a round-up of one of the best-performing conglomerates in the market. Hope this gives you a good idea about the levels to track in each stock.

Thanks for reading and please let us know if you have any questions.

Allstarcharts Team

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