Shares of Reliance Power hit the 5 percent upper circuit for the eighth straight session on September 27 amid a flat movement in the benchmark indices. The stock of Anil Ambani's firm has been rallying since September 9 due to various triggers.
On September 16, the stock hit the upper circuit after the firm secured a major Battery Storage Contract of 500 MW/1000 MWh from the Solar Energy Corporation of India (SECI). The contract positions Reliance Power as a key player in one of the world’s largest standalone battery energy storage projects, it said.
On September 18, sentiments around the stock received another boost after the Anil Ambani-led firm said it has been released and discharged of its corporate guarantee, undertakings and all obligations and claims in relation to the outstanding debt of subsidiary Vidarbha Industries Power Limited (VIPL), amounting to Rs 3,872.04 crore.
The company said it settled all disputes with CFM Asset Reconstruction Private Limited (CFM), as 100 per cent shares of VIPL have been pledged in favour of CFM against the release and discharge of corporate guarantee given by Reliance Power. The stock hit upper circuit of 5% in the same trading session.
On September 19, shares climbed 5 percent again as the company informed that the board of directors of Reliance Power is scheduled to meet on September 23 to consider and approve raising of long-term resources from domestic and/or global markets.
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On September 23, the Anil Ambani-led company announced a preferential issue of 46.2 crore equity shares worth Rs 1,524.60 crore at a price of Rs 33 per share, which was at a 14 per cent discount to Monday's closing price for the stock.
The issue was proposed to be made to promoter Reliance Infrastructure Ltd and non-promoter entities Authum Investment and Infrastructure Ltd and Sanatan Financial Advisory Services Private Ltd (Sanjay Kothari and Meenakshi Sanjay Kothari.)
Analysts were largely bullish on the prospects of the stock following the recent developments. At 1:13 pm, Reliance Power shares were locked at 5 percent at Rs 46.35 on NSE. So far this year, the stock has gained 93 percent, compared to an 18 percent rise in benchmark Nifty.
In just the last one month, the stock has surged 49 percent. In the last one year, Reliance Power stock has zoomed 140 percent, more than doubling investors' capital. In comparison, Nifty gained 30 percent during this period.
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