ADANIGREEN - Investment Analysis: Buy Signal or Bull Trap?
Back to ListInvestment Rating: 2.6
| Stock Code | ADANIGREEN | Market Cap | 1,57,148 Cr. | Current Price | 954 ₹ | High / Low | 1,179 ₹ |
| Stock P/E | 213 | Book Value | 89.8 ₹ | Dividend Yield | 0.00 % | ROCE | 8.87 % |
| ROE | 9.41 % | Face Value | 10.0 ₹ | DMA 50 | 951 ₹ | DMA 200 | 1,024 ₹ |
| Chg in FII Hold | 0.13 % | Chg in DII Hold | 1.33 % | PAT Qtr | 82.0 Cr. | PAT Prev Qtr | 475 Cr. |
| RSI | 55.2 | MACD | -29.1 | Volume | 47,72,597 | Avg Vol 1Wk | 59,50,308 |
| Low price | 758 ₹ | High price | 1,179 ₹ | PEG Ratio | 1.91 | Debt to equity | 1.18 |
| 52w Index | 46.6 % | Qtr Profit Var | -85.3 % | EPS | 4.11 ₹ | Industry PE | 26.2 |
📊 Adani Green (ADANIGREEN) is trading at extremely high valuations (P/E 213 vs industry 26.2), making it expensive relative to peers. Profitability metrics are weak with ROE (9.41%) and ROCE (8.87%), far below industry leaders. Dividend yield is nil (0.00%), offering no income return. PEG ratio of 1.91 suggests the stock is overpriced relative to growth. Quarterly profit variance (-85.3%) raises concerns about earnings consistency, with PAT dropping sharply (82 Cr. vs 475 Cr.). Technical indicators show neutral momentum (RSI 55.2, MACD negative), with the stock trading near its 50 DMA but below the 200 DMA, indicating weak long-term trend.
💡 Ideal Entry Price Zone: 750 ₹ – 850 ₹, closer to long-term support and valuation comfort. Current price (954 ₹) is stretched relative to fundamentals.
📌 Exit Strategy / Holding Period: If already holding, consider partial exit near 1,150–1,180 ₹ resistance levels. Long-term investors should only hold if expecting structural growth in renewable energy capacity and profitability improvement. Otherwise, reallocate capital to peers with stronger ROE/ROCE and more sustainable earnings. Holding period should be limited until earnings visibility improves.
Positive
- Strong market capitalization (1,57,148 Cr.) ensures liquidity.
- Institutional support with FII (+0.13%) and DII (+1.33%) holdings increasing.
- Stock trading near 50 DMA shows short-term support.
Limitation
- Extremely high P/E ratio (213) compared to industry average (26.2).
- Weak ROE (9.41%) and ROCE (8.87%) indicate poor efficiency.
- Dividend yield is nil (0.00%), offering no income return.
- Quarterly profit variance (-85.3%) raises concerns about earnings stability.
Company Negative News
- PAT dropped sharply from 475 Cr. to 82 Cr.
- MACD negative (-29.1) suggests bearish short-term trend.
Company Positive News
- Institutional investors (FII & DII) increased holdings.
- EPS of 4.11 ₹ supports valuation base, though modest.
Industry
- Industry P/E is 26.2, highlighting ADANIGREEN’s steep premium valuation.
- Renewable energy sector has strong long-term demand potential in India.
Conclusion
⚠️ Adani Green is currently overvalued with weak profitability metrics and volatile earnings. It is not an ideal candidate for long-term investment at current levels. Entry should be considered only around 750–850 ₹ for valuation comfort. Existing holders may exit near 1,150–1,180 ₹ resistance unless ROE/ROCE improve significantly and earnings growth becomes more sustainable.