Shares of Adani Power Ltd hit a fresh record high on April 3 with the stock surging for the fourth straight sessions amid higher volumes.
The stock rallied 5 percent to a record high of Rs 611.75 on the BSE after gaining 18.4 percent in the last four trading sessions. It jumped 15.3 percent so far this year, while in the last one year, it surged 214 percent.
Although Adani Power's market capitalisation stands at Rs 2.33 lakh crore, only one broker, Ventura Securities, covers the stock. It ranks 37th among all listed firms on the BSE, surpassing companies like JSW Steel, Tata Steel, Siemens, IRFC, Varun Beverages, Bharat Electronics, Grasim Industries Ltd, and Zomato in terms of market capitalisation.
Adani Power subsidiary Mahan Energen Ltd recently signed a 20-year power purchase agreement for 500 MW with Reliance Industries. A 600-MW unit from MEL's Mahan thermal power plant, out of its total capacity of 2800 MW, will serve as the captive unit for this agreement.
To comply with the policy requirements, RIL will hold a 26 percent ownership stake in the captive unit, entailing an investment of Rs 50 crore for 5 crore equity shares of MEL. This agreement marks an exclusive arrangement between the two companies for long-term power purchase of 500 MW by Reliance Industries.
Adani Power in its latest presentation said it aims to increase its power assets by nearly 6 gigawatts (Gw) over the next five years. This expansion is targeted to meet India's growing power demand, focusing solely on thermal power generated from coal.
Last month, news agency Reuters reported that the private Indian firms, including Adani Power, JSW Group, and Essar Power, have shown interest in building approximately 10 gigawatts (GW) of coal-fired power capacity over the next decade, ending a six years of minimal private involvement in the sector.
These potential investments, not previously disclosed, could require significant financial commitments and indicate renewed interest in an industry often viewed as financially challenging. However, the focus on coal-fired power expansion may counter efforts to reduce carbon emissions, despite the Indian government's aim to attract private investment to increase coal-fired capacity by 80 GW by 2032, report added.
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