Adani Power shares extend gains, jump 7% today; here's what analysts say – Business Today

Shares of Adani Power Ltd continued to rise for the third straight session in Monday’s trade. The stock surged 6.84 per cent to hit a day high of Rs 325.50 over its previous close of Rs 304.65. Around 37.73 lakh shares changed hands today on BSE, much lower than the two-week average volume of 3.77 crore shares. Turnover on the counter stood at Rs 120.64 crore, commanding a market capitalisation (m-cap) of Rs 1,24,617.70 crore.
Bharat Heavy Electricals Ltd (BHEL) today stated that it has received an order from Mahan Energen Ltd (formerly known as Essar Power MP Ltd). Mahan Energen is a wholly-owned subsidiary of Adani Power.
Recently, the power arm of Adani Group clarified that it is not engaged in any discussion with Abu Dhabi National Energy Co PJSC (TAQA) for their investment.
The scrip, which saw a steep fall after US-based short seller Hindenburg Research’s attack earlier in February this year, has staged a strong recovery since then. It has rebounded 89.02 per cent in the last six months. That said, it has climbed 8.50 per cent in 2023 so far.
The company posted a strong set of results for the first quarter that ended on June 30, 2023 (Q1 FY24). The company’s net profit jumped 83.30 per cent to Rs 8,759 crore in Q1 FY24 as against Rs 4,780 crore in the corresponding period last year.
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Adani Power said its consolidated total revenue grew by 16.80 per cent to Rs 18,109 crore in Q1 FY24 over Rs 15,509 crore in the year-ago period, mainly due to improved volumes, higher one-time revenue recognition on account of regulatory claims and late payment surcharge.
On the technical setup, analysts were divided on the counter. The stock may see support at Rs 305, one of them said.
Market expert Ravi Singh said, “Adani Power is looking strong on long-term and short-term moving averages. Other momentum indicators such as RSI (Relative strength index) and MACD (Moving Average Convergence/Divergence) are also in support of the trend. The stock may touch the levels of Rs 350 in coming weeks.
AR Ramachandran from Tips2trades said, “Adani Power looks slightly bullish but also overbought on the daily charts with next resistance at Rs 335. A daily close below support of Rs 305 could lead to target of Rs 283 in the near term.”
The stock today was last seen trading higher than the 5-day, 10-, 20-, 30-, 50-, 100-, 150-, and 200-day simple moving averages (SMAs). The counter’s 14-day RSI came at 76.98. A level below 30 is defined as oversold while a value above 70 is considered overbought. The company’s stock has a price-to-equity (P/E) ratio of 9.70 against a price-to-book (P/B) value of 4.41.
The scrip has a one-year beta of 1.04, indicating average volatility.
Meanwhile, Indian equity benchmarks were up today, led by gains in technology, financial metal, pharma and consumer stocks.
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