Adani Power jumps 3% on robust Q3 results, sale of two subsidiaries

AIPL and IBPL will cease to be wholly owned subsidiaries of Adani Power upon completion of the sale

Adani Power shares jumped over 3 percent on January 29 after AdaniConnex (ACX), a 50:50 joint venture between Adani Group and EdgeConneX, signed a contract with Adani Power to acquire a 100 percent equity stake in two wholly owned subsidiaries of the company.

Adani Power will sell Aviceda Infra Park Ltd (AIPL) for Rs 190 crore and Innovant Buildwell (IBPL) for Rs 350 crore to AdaniConnex. Both transactions are expected to be completed by March 31, 2024.

AIPL and IBPL will cease to be wholly owned subsidiaries upon completion of the sale, Adani Power said.

At 9:20am, Adani Power shares were trading 2.7 percent higher at Rs 558.00 on the National Stock Exchange (NSE). In the last one year, the stock has rallied over 136 percent, doubling investors' money. In comparison, the benchmark Nifty rose around 21 percent during this period.

Follow our market blog to catch all the live action

In the week gone by, Adani Power reported a multi-fold surge in consolidated net profit on-year at Rs 2,737.96 crore for the quarter ended December 31, 2023. The net profit for the same quarter in the year-ago period was Rs 8.77 crore. Its sales for the quarter rose 67 percent on-year to Rs 12,991 crore.

The revenue growth was on account of higher operating capacity after the commissioning of the Godda thermal power plant, and improved power offtake following growth in demand and lower imported fuel prices, the company said in a statement.

Its earnings before interest, tax, depreciation, and amortisation (EBITDA) for Q3 FY24 surged 151 percent YoY to Rs 5,009 crore due to higher contribution on account of lower fuel costs and strong merchant prices.

Adani Power's finance costs for the quarter under review reduced to Rs 797 crore from Rs 946 crore in the same quarter last year, mainly due to a reduction in secured and unsecured debt over the past year, partly offset by higher borrowing costs for the Godda power plant.

Also Read | Q3 results: Adani Power net profit at Rs 2,737.96 crore

Adani Power said it used improved liquidity to cut debt and said the 1,600 MW brownfield capacity at Mahan was on track.

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.