Ambani Group stock engaged in the business of developing, constructing, and operating power projects hits a 5 percent upper circuit in the day’s trade following entry into Bhutan and developing Renewable projects.
Price Action
With a market capitalization of Rs. 21,551 Crores, the shares of Reliance Power Limited hit a 5 percent upper circuit at Rs. 53.65 per equity share, from its previous day’s close price of Rs. 51.10.
What Happened
Anil Ambani Led Reliance Group has incorporated a new wholly-owned subsidiary named Reliance Enterprises Private Limited which is jointly promoted by Reliance Infrastructure Limited and Reliance Power Limited. The new Company’s main objective is to promote, invest, and develop major solar and hydropower projects in Bhutan.
Following this it has signed 2 partnerships/Joint ventures with Druk Holding and Investments Ltd (DHI), the commercial arm of the Bhutanese government, to boost investments and develop renewable energy projects in Bhutan. Reliance Enterprises will focus on enhancing sustainable energy solutions and implementing smart distribution and metering systems throughout Bhutan.
The 1st Power Generation JV agreement is to develop a 770 MW Chamkharchhu-1 Hydro Project in Bhutan. It is classified as a run-of-the-river project. With Bhutan’s current installed power generation capacity at 2,452 MW, this project is particularly significant as it represents a joint venture between Bhutan and a private sector company in India.
The 2nd 1st Power Generation JV agreement is to develop a 500 MW Solar Power Plant in Gelephu Mindfulness City, Bhutan. This ambitious project is set to be executed over the next two years in two phases of 250 MW each.
Once completed, the solar plant will be the largest of its kind, surpassing all existing solar installations in the country, and will produce clean, renewable energy to help mitigate the impacts of climate change.
About the Company
Reliance Power Limited is engaged in the business of developing, constructing, and operating power projects across India as well as across borders. It is involved in coal, gas, hydro, wind, and solar-based energy projects. In India, it has a total installed capacity of 5,340 MW, including the 4,000 MW Ultra Mega Power Project in Sasan, Madhya Pradesh
In Addition, its subsidiary Reliance Infrastructure Limited is active in the energy sector, focusing on power distribution in Delhi and power generation. It also has interests in defence manufacturing and plays a key role in infrastructure development through special purpose vehicles (SPVs), including projects like the Mumbai Metro and various airport developments.
Financials and Ratios
Its Revenue from operations grew by 3.6 percent from Rs. 1,922 Crores in Q1FY24 to Rs. 1,992 Crores in Q1FY25, accompanied by decreasing losses of Rs. 296 Crores to Rs. 98 Crores.
In terms of Return ratios, it has reported a return on equity (ROE) of -17.6 percent, and a return on capital employed (ROCE) of 1.43 percent. It has reported a debt-to-equity ratio of 1.62.
Written by: Bharath K.S
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