Adani Enterprises: 4 key reasons why Jefferies expects 17% upside for the stock post start of its copper unit

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Adani Enterprises share price that has risen 90% in last year has more than doubled from lows seen in February last year. Analysts at Jefferies India Limited however expect almost 17% upside for Adani Enterprises led by commissioning of Copper unit first phase and expansions being undertaken during second phase. The target price of Jefferies for Adani Enterprises stands at ₹3800 while the stock is trading at close to ₹3260 levels.

Adani Enterprises Limited's subsidiary Kutch Copper recently had inaugurated the first unit of its greenfield copper refinery project in Mundra on March, 28 by shipping the first batch of cathodes to a client. This project represents a significant milestone for Adani Enterprises as it expanded and entered into a new industry and enhances the domestic copper supply in India. Also Read- Sobha, DLF, Phoenix Mills and 3 other realty stocks delivered 100%-235% returns in FY24; check full list Hindalco Industries and Vedanta Ltd have remined two well known copper producers while public sector undertaking Hindustan Copper Limited is an integrated manufacturer.

Vedanta Copper production at Tuticorin however remains impacted. With capacity constraints in country amidst rising domestic demand and export opportunities, Adani Enterprises entry into Copper cathode production is expected to be fruitful. Adani Enterprises is expected to reap benefits with start of first phase of 500,000 tonne per annum capacity.

Second phase with similar capacity will likely start in the year. Analysts at Jefferies said that start of Copper unit marks the Adani Portfolio’s debut in the metal industry. The full project once commissioned will be one of the largest single-location custom smelter in the world.