Adani Wilmar Shares Surge Over 4% Despite Weak Market: More Gains Ahead?

Despite a weak Indian stock market on Monday, Adani Wilmar shares saw strong buying. The stock opened higher at ₹344.95 per share on the NSE and quickly hit an intraday high of ₹347. This comes after the company announced a positive Q1FY25 business update last Friday, showing a 13% year-on-year growth in volume.

Business Update Highlights

• Volume Growth: Adani Wilmar achieved a 13% YoY volume growth from April to June 2024, thanks to targeted strategies in various markets, particularly under-indexed ones.
• Sales Channels: The company’s alternate channels (e-commerce, Quick Commerce, Modern Trade) saw a 19% YoY volume growth in Q1, while branded exports increased by 36% YoY.
• Edible Oil Business: Despite industry challenges like reduced out-of-home consumption and seasonal demand dips, the edible oil segment performed well due to strong sales and distribution efforts. Adani Wilmar, a leader in the mustard oil segment, expanded its market share and introduced specialized mustard oil packaging for pickle enthusiasts. Sunflower oil also gained market share in South India.
• Food and FMCG: This segment saw strong growth by leveraging the distribution network of edible oils and strategic bundling. Non-basmati rice sales to government agencies for export also boosted growth, with the Food and FMCG volume increasing by 23% YoY even after normalizing these sales.

Stock Outlook

Sumeet Bagadia, Executive Director at Choice Broking, commented that Adani Wilmar shares have solid support at ₹320 per share but face resistance in the ₹360 to ₹370 range. The stock appears to be in a sideways trend on the technical chart, with a breakout on either side indicating a new trend.

Current Market Performance

All three major indices on Dalal Street are down today:

• The Nifty 50 index dropped around 50 points.
• The BSE Sensex fell nearly 100 points.
• The Bank Nifty index corrected by about 300 points.