Adani Power gains 4%, hits new high on DB Power deal; up 47% in one month

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In a typically lacklustre market, shares of Adani Power reached a fresh high of Rs 428.20 during intraday trading on Monday after the firm announced its agreement to purchase DB Power's thermal power assets for an estimated Rs 7,017 crore.

In Chhattisgarh's District Janjgir Champa, DB Power owns and runs a functioning 2x600 MW thermal power plant with an annual revenue of Rs 3,488 crore (FY22).

"The purchase will assist in expanding its operations and product offerings in the state of Chhattisgarh's thermal power industry. 

Adani Power, however, has outpaced the market over the previous month, rising 47% compared to the S&P BSE Sensex's 6% increase. The stock has soared 255% over the last six months compared to the benchmark index's gain of 3%.

The business recorded a 17-fold increase in its consolidated profit after tax (PAT) at Rs 4,780 crore in the June quarter, which set off the sudden increase in the stock price (Q1FY23). The electric utility firm owned by the Adani Group reported PAT of Rs 278 crore in Q1FY22.

EBITDA, which stands for earnings before interest, taxes, depreciation, and amortisation, increased by 227 percent year over year to Rs 7,506 crore.

"The Indian government has enhanced the country's electricity sector through a number of changes. 

These Include Fuel Links Provided Under The Ujwal DISCOMS Assurance Yojana (UDAY) To Spur The Transformation Of Electricity Distribution Firms And The Scheme For Harnessing And Allocating Koyala (Coal) Transparently In India (SHAKTI), Among Others "In Its Annual Report For FY22, Adani Power Stated.

The Pradhan Mantri Har Ghar Sahaj Bijli Yojana (Saubhagya) initiative and the Deen Dayal Upadhyaya Gram Jyoti Yojana (DDUGJY) for rural electrification have been combined to improve electricity accessibility to the last person through a wider network and policies intended to increase the viability of distribution companies, the company said.

Adani Power added that the availability of a cost-effective and dependable power supply is a key factor in overall growth. It is crucial for boosting the human development index and driving industrial development.

Due to the government's emphasis on "Make in India," rising disposable incomes and standards of life, as well as expanding industry, power demand in India is predicted to increase sustainably. According to the Central Energy Authority (CEA)

India's peak electricity consumption would be about 340 GW by 2030, up from a peak demand of 203 GW in 2021, the business claimed.

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