Shares of this smallcap company jumped around 2 percent in Wednesday’s trading session after two of its subsidiaries settled Rs 1,023 crores debt. The shares have delivered a multibagger return of 196 percent in one year to its shareholders.
With a market capitalization of Rs. 10,633 crores, the shares of Reliance Power Ltd started Wednesday’s trading session on a higher note at Rs. 28.45 compared to its previous close of Rs. 27.60. During the trading session, the shares hit a high of Rs. 28.50, gaining around 2 percent and are currently trading at Rs. 27.80 apiece.
Such a positive movement in the share price was observed after the company in an exchange filing announced that two of its subsidiaries i.e., Kalai Power Pvt Ltd and Reliance Cleangen Ltd, have signed a debt settlement and discharge agreement with Reliance Commercial Finance Ltd (RCFL), a wholly-owned subsidiary of Authum Investment and Infrastructure Limited, in settlement of the entire obligations for their outstanding consolidated debt of worth Rs 1,023 crores.
Earlier, Reliance Power had signed an agreement to sell a 45 MW wind power project in Maharashtra to JSW Renewable Energy for Rs. 132 crores. Further, the company said that it would use the proceeds of the sale to retire its debt, adding that it was aiming to be debt-free by the end of the current financial year.
Moreover, over the past few months, the company has been actively signing debt settlement agreements with various banks, including DBS Bank, Axis Bank, and ICICI Bank. At the end of fiscal year 2023, Reliance Power had an outstanding debt of around Rs 700 crores.
In 2022, Authum Investment, in a bank-led resolution process, acquired Reliance Commercial Finance and Reliance Home Finance from Reliance Capital.
Coming onto the company’s financial statements, the revenue decreased by 5 percent from Rs. 2,052 crores during the September quarter to Rs. 1,947 crores in the December quarter. On the other hand, the net losses of the company increased from Rs. 238 crores to Rs. 1,137 crores during the same period.
Headquartered in Maharashtra, Reliance Power was incorporated in 1995. The company was established to develop, construct and operate power projects both in India as well as internationally. 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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