Adani Power stock gains on new subsidiary launch in Middle East

So far this year, Adani Power stock has rallied 27 percent, outpacing benchmark Nifty's returns of around 14 percent during this period.

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Adani Power stock edged higher on August 27 after the company set up a subsidiary in the Middle East. Adani Power Middle East Ltd. was officially incorporated on August 26 with an authorised capital of 27,000 shares, each valued at US $1, the Adani group firm informed in a regulatory filing.

As of now, the subsidiary has yet to commence business operations, so its size and turnover are not applicable at this stage. The object of this new company is to invest in power, infrastructure, and related fields.

The cost of acquisition for the shares involves an initial subscription to the share capital of $27,000, which is divided into 27,000 shares with a nominal value of $1 each. Adani Power Limited holds 100 percent of the share capital in the incorporated company, according to the exchange filing.

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At 9:18 am, Adani Power shares were trading over a percent higher at Rs 670.65 on the National Stock Exchange (NSE). So far this year, the stock has rallied 27 percent, outpacing benchmark Nifty's returns of around 14 percent during this period.

The counter has rallied 106 percent in the last 12 months, more than doubling investors' capital. In comparison, Nifty delivered returns of around 27 percent during this period.

Meanwhile, reports surfaced recently which claimed that the Gautam Adani-owned power firm is dealing with unpaid dues of around $800 million from Bangladesh.

This debt has accumulated for electricity supplied by Adani Power's coal-fired plant in Godda, located in Jharkhand, India. Ahsan H Mansur, the newly appointed Governor of Bangladesh Bank, confirmed the unpaid dues in an interview with Bloomberg News last week.

Adani Power is currently negotiating with Bangladesh’s interim government to resolve this issue, the report added. Adani Power’s Godda power plant began its operations in April 2022 with outsized ambitions in Bangladesh.

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