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Adani Power shares hit a record high in the deal to buy DB Power

Adani Power shares hit a record high

Adani Power shares hit an all-time high today after the Adani Group firm said it would buy DB Power Ltd for an enterprise value of Rs 7,017 crore. The stock hit a record high of Rs 429.65, up 3.83 percent from the previous close of Rs 412.20. The company’s total of 13.97 lakh shares changed hands, with a turnover of Rs 59.32 crore in BSE. The company’s market capitalization rose to Rs 1.64 lakh crore on BSE.

Adani Power shares are trading above the 5, 20, 50, 100, and 200-day moving averages. The stock has gained 450.87 percent in one year and 327.72 percent in 2022. The stock hit a 52-week low of Rs 69.95 on August 24, 2021.

With today’s rally, Adani Power shares are up 514 percent from their 52-week low due to BSE.

Adani Power aims to expand its offering and operations in the thermal power sector in Chhattisgarh. DB Power owns and operates two units of a 600 MW thermal power plant in the Janjgir Champa district of Chhattisgarh. Diligent Power (DPPL) is the holding company of DB Power.

Adani Power Stock: 400% above the 52-week low; how long will the rally last?

The initial MoU period for this acquisition will be until October 31, 2022, but can be extended by mutual agreement, the firm said in a filing to exchanges.

Adani Power will hold 100% of the total issued, subscribed, and paid-up share capital and preferred share capital of DPPL. DPPL will own 100% of DB Power from the transaction’s closing date.

DB Power, incorporated in October 2006, is engaged in establishing, operating, and maintaining a thermal power generating station in Chhattisgarh. It also has medium and long-term power purchase agreements for 923.5 MW of capacity, backed by fuel supply agreements with Coal India Limited, and is operating its facilities profitably.

Pavitra Shetty, Co-Founder, and Trainer of Tips2Trades said: “While fundamentally Adani Power has shown considerable improvement in its financials, the stock is undervalued and overbought by all accounts. Tips for Investors As long as you continue to book or profit on the current levels, Stop loss with immediate support at Rs.419”.

Manoj Dalmiya, Founder and Director of Profitable Equities, said: “Adani Power has been making higher highs in recent weeks. Investors can enter with a short-term price target of Rs 477. The move comes after the firm of Adani Group, Adani Power, announced today that it will acquire DB Power Ltd. for an enterprise value of Rs 7,017 crore. With the acquisition, Adani Power aims to expand its offering and operations in the thermal power sector in Chhattisgarh.

Rajesh Sinha, the Senior Research Analyst at Bonanza Securities, said: “Adani Power further increased its profitability with the acquisition of DB Power Ltd. Through this acquisition, Adani Power aims to expand its offering and operations in thermal power. In Chhattisgarh. DB Power owns and operates two units of the 600 MW thermal power plant in the Janjgir Champa district of Chhattisgarh. India’s electricity demand is increasing due to industrial and residential demand in the coming years. The outlook is likely to remain strong. This is a good sign from Adani. Power Outlook. The company has eight power plants strategically located in critical regions of the country. While India’s transition to renewable energy is underway, progress is relatively slow. Therefore, it presents a better approach for thermal power generators. Dependence on thermal power also p presents opportunities for long-term power purchase agreements for power companies, including Adani Power. Quarterly performance, DB Power acquisition and India’s power demand, Adani’s long life of power The outlook looks promising, and investors may consider any disadvantage to entering Adani Power for a long-term investment.

In the June quarter of the current financial year, Adani Power reported a 17-fold increase in its consolidated net profit to Rs 4,780 crore from Rs 278 crore in the corresponding quarter of the previous year.

Total revenue doubled to Rs 13,723 crore in the first quarter from Rs 6,568.86 crore in the previous quarter.

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