Adani Power shares surge 25% in five sessions due to this reason

Shares of Adani Power continued their uptrend for the fifth straight session on Friday, thanks to strong financial performance and positive outlook for the power sector amid rising demand. The share price of one of the country’s largest private thermal power producers has risen as much as 24.5% in five sessions since its closing on October 25, 2023.

Early today, Adani Power shares opened 1.1% higher at ₹377 against the previous closing price of ₹372.75 on the BSE. In the first three hours of trade so far, the power heavyweight gained as much as 4.5% to hit a high of ₹389.50, while the market capitalisation rose to ₹1.48 lakh crore.

Adani Power shares have witnessed a strong rally in the recent past with its stock price hitting a 52-week high of ₹410 on September 12, 2023. The stock rebounded over 200% from its 52-week low of ₹132.55 touched on February 28, 2023.

At the current price level, Adani Power shares are up 193% against its 52-week low, while they are down 5% from its 52-week high.

The power and energy arm of Adani Group has outperformed BSE benchmark Sensex and BSE Power index in terms of returns in the last one year. Adani Power share price gained nearly 12% in the past 12 months compared with 6% rise in the Sensex. In contrast, the power index shed 9.5% in a year. In the calendar year 2023, shares of Adani Power jumped 28% as against 6% and 2% growth in the Sensex and power index, respectively. In the last six months, the stock has surged 65%, while it added 43% in the last three months.

Adani Power shares got a boost today after the Adani group company reported consolidated profit after tax (PAT) of ₹6,594 crore in the July-September quarter of FY24, which is higher by 848% as compared to ₹696 crore during the same period last year.  The strong growth in profit was attributed to improved EBITDA, higher one-time income, and recognition of deferred tax assets during the quarter under review.

The company's consolidated revenue for Q2 FY24 was higher by 61% at ₹12,155 crore against ₹7,534 crore in the same period last year, mainly due to greater sales volumes. EBITDA was recorded at ₹4,336 crore, up by 202%, against ₹1,438 crore for Q2 FY23, thanks to greater sales volumes, lower fuel cost, and higher merchant tariffs.

For the first half of the fiscal year, the profit jumped 180% to ₹15,354 crore as compared to ₹5,475 crore in H1 FY23. The revenue grew 26% to ₹23,767 crore as compared to the same period last fiscal.

The company sold 18.1 billion units (BU) of power in the quarter (Q2 FY24), which increased by 65% from 11 BU in Q2 FY23 on improved power demand and higher operating capacity. In the first half of the fiscal year, the company's power sale volume was at 35.6 BU in H1 FY24, up 30% YoY.

The company has attributed improved performance to higher power offtakes in Mundra, Udupi, Raipur, and Mahan plants apart from the incremental contribution of Godda. Adani Power's Godda plant has ramped up its operations in a short time after commissioning. 

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