Adani Power shares soar 5%, extend rally to 15% in four sessions

The most recent has been the company signing a 20-year power purchase agreement for 500 MW with () marking a rare and strategic collaboration between conglomerates led by two of the country’s wealthiest men. Under the agreement, the Mukesh Ambani company will invest Rs 50 crore for a 26% stake in a 600 MW unit of Mahan Energen’s thermal power plant. The latter is a wholly owned subsidiary of Gautam Adani-led Adani Power.

The company recently amalgamated six of its Special Purpose Vehicles (SPVs) with itself by which it has consolidated the standalone term loan facilities of the SPVs into a single long-term Rupee term loan facility of Rs 19,700 crore under a consortium financing arrangement comprising eight lenders.

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According to the claims made by the company in its filing to the exchanges, the revised arrangement will allow Adani Power to benefit from uniform terms and greater financial flexibility in addition to reducing the effective rate of interest.

The restructuring of its SPV came following an enhancement in the credit rating of Adani Power to AA-.

India Ratings upgraded the credit rating assigned to the term loan facilities of Adani Power from 'IndA/Positive' to 'INDAA-/Stable'. Similarly, it also upgraded the credit rating assigned to the working capital facilities of the company from 'IndA/Positive/A1' to 'IndAA-/Stable/A1+”.

After hitting a 52-week low of Rs 185.20 on the NSE following the Hindenburg Research report, the stock has seen a meteoric rise. In less than a year, the counter hit its 52-week high of Rs 589.45, rising a whopping 218%.

The price was supported by strong volume action with 17.19 lakh shares changing hands on the NSE around 10:12 am. The traded value of the shares stood at Rs 100.53 crore.

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