Shares of this power generation company locked 10 percent upper circuit after the company became debt-free on a standalone basis. In just five trading sessions, the stock delivered more than 25 percent returns to its shareholders.
With a market capitalization of Rs. 12,666 crores, the shares of Reliance Power Ltd started Wednesday’s trading session on a higher note at Rs. 29.70 compared to its previous close of Rs. 28.68. During the trading session, the shares clocked 10 percent upper circuit at Rs. 31.54 apiece.
Such a bullish movement in the share price was observed after reports from news agency PTI, citing sources, indicating that the company has successfully become debt-free on a standalone basis. As per the reports, with an outstanding debt of approximately Rs 800 crores, Reliance Power has reportedly repaid its dues to banks.
During the period between December 2023 to March 2024, Anil Ambani-backed company has signed multiple debt settlement agreements with marquee bankers including IDBI Bank, ICICI Bank, Axis Bank, and DBS. The source claimed that the company has paid off the entire debt it had with these banks.
As a result of that, Reliance Power, on a standalone basis, has become a debt-free company.
Earlier, in December 2023, Reliance Power sold the development rights of its proposed 1,200-megawatt hydroelectric project in Arunachal Pradesh to THDC for Rs. 128 crores.
Further, in March 2024, the power generation company sold its 45 MW wind energy project in Vashpet, Maharashtra to JSW Renewable Energy for a consideration of Rs. 132 crores. Proceeds from the sale of these projects were used to retire debt.
At present, Anil Ambani’s Reliance Power has an operating capacity of 5900 MW, which includes 3960 MW Sasan UMPP and 1200 MW Rosa Thermal power plant in Uttar Pradesh. Moreover, the company has an equity of Rs.4,016 crore with the participation of more than 38 lakh retail shareholders.
Looking at the company’s financial performance during the latest quarter, the revenue increased by around 3 percent from Rs. 1,946.58 crores during the December quarter to Rs. 1,946.58 crores to Rs. 1,996.65 crores in the March quarter. On the other hand, the company decreased its net loss from Rs. 1,136.75 crores to Rs. 397.56 crores during the same period.
Comparing the same metrics on a YoY basis, the revenue jumped by 15 percent from Rs. 1,729.84 crores during Q4FY23 to Rs. 1,996.65 crores in Q4FY24. On a contrasting note, the net profit showcased a transition from a net profit of Rs. 256.91 crores to a net loss of Rs. 397.56 crores during the same timeframe.
In the March quarter, Foreign Institutional Investors increased their stake by 4.64 percent from 8.37 percent to 13.01 percent. Concurrently, Promoters maintain a 23.24 percent stake, DIIs hold 4.94 percent of the stake and the public holds the remaining 58.80 percent of the company’s shares during the same period.
Reliance Power, a part of the Reliance Group, is engaged in the business of developing, constructing and operating power projects both in India as well as internationally. The company on its own and through its subsidiaries has a large portfolio of power generation capacity, both in operation as well as capacity under development.
Written By Vaibhav Patil
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