Reliance Power shares rally 55% in 9 days: Why Is Reliance Power (RPower) Share Rising

Anil Ambani's Reliance Power stock is rallying before the important meeting to be held this week.

Reliance Power (RPower), led by Anil Ambani, has seen its shares surge by around 55% over the past nine trading sessions. From a closing price of Rs 31.40 on September 17, the stock has been hitting upper circuits consecutively, reaching Rs 48.66 by the latest session.

This significant rally comes ahead of a board meeting scheduled for Thursday, October 3, where the company is expected to consider a fundraising proposal.

Reliance Power Share Rally On Stock Market

On Monday, September 30, despite opening lower at Rs 46.25 per share compared to the previous close of Rs 46.35, Reliance Power shares saw heavy volatility. The stock initially dropped by nearly 5% to a low of Rs 44.21 due to profit booking. However, by midday, it recovered losses and once again surged to hit the upper circuit at Rs 48.66 on the NSE.

By 1 PM, approximately 20.62 crore shares had been traded on the NSE, while around 3.57 crore shares changed hands on the BSE, showcasing high investor interest, according to an ET Now report.

Why Is Reliance Power Share (RPower) Rising?

• Settlement of Rs 3,872 Crore Guarantee: RPower announced that it had fully settled a Rs 3,872 crore guarantee related to Vidarbha Industries Power (VIPL). This move resulted in the release of all corporate guarantees, obligations, and undertakings tied to the outstanding debt of Rs 3,872.04 crore.

  
  

• Resolution of Disputes: RPower also settled all disputes with CFM Asset Reconstruction, with 100% of VIPL shares being pledged in favor of CFM in exchange for the release and discharge of the corporate guarantee given by Reliance Power.

  
  

• Zero Debt Status: Another major announcement by RPower was that the company has achieved zero debt from banks and financial institutions. The company’s consolidated net worth stood at Rs 11,155 crore at the end of the first quarter of FY25.

  
  

• Board Meeting Announcement: Additionally, on Friday, September 27, RPower announced a board meeting to discuss a fundraising proposal.

This combination of debt reduction, financial stability, and the prospect of new fundraising has led to a continued upward trajectory in Reliance Power's share price, even in a volatile market.

Reliance Power's board approved the preferential issue on Monday, with over Rs 600 crore coming from its promoter company, Reliance Infrastructure, and the remaining Rs 900 crore from Authum Investment and Infrastructure Ltd and Sanatan Financial Advisory Services.

This preferential issue is expected to boost Reliance Power's net worth from Rs 11,155 crore to over Rs 12,680 crore, maintaining its zero-bank-debt status, according to company stock marketing filing.

Source: PTI