What is the difference between Adani Group and Ambani Group (RIL)?

Introduction:

According to an article in Economic Times, the concentration risk is very high for some foreign funds in the Adani stocks. They have invested up to 97% of their total Asset under Management in the Adani Group. So what makes the difference between Adani Group and Ambani Group (Reliance Industries Limited)?

What is the difference?

• We can learn a lot of things if we keep attention on the Adani Group stocks. When we invest in a stock, we invest in the business.
• The cash cow for the RIL Group is their Oil to Chemical business which the only cash generator some years back, whereas, the Ports and SEZ is the cash-generating business for the Adani Group.
• The Reliance Industries Limited has first shown strong performance in their Jio as well as retail business, whereas, the Adani stocks have shown stock performance before even giving business performances.
• The business of RIL Group has shown performance and now they are looking for a listing in Stock Market but in Adani Stocks, they are listening before the business even started generating cash for the company.
• The article published in Economic Times states that those funds investing in Adani Stocks don’t even have their websites.

Conclusion:

An investor should look at the business from a long-term perspective and not through the way of earning in the short term. Ideally, the company should show some growth in their business and then only go for listing in the stock market. Do not invest based on news and borrowed conviction. One should consult its financial advisor or conduct a proper research study before making any investment decision.