This Adani Group stock rose 59% in a week, should you buy?

Share of Adani Power rose 19 per cent to hit a 52-week high of Rs 151.50 on BSE today on the back of heavy volumes. The stock opened 5.5 per cent higher at Rs 134 against the previous close of Rs 126.95 on BSE.

As per the share price history, Adani Power stock on BSE closed at Rs 95.4 on June 1, 2021. It hit an intraday high of Rs 151.50 in today’s morning session. In a week, the stock has delivered 58.8 per cent returns. Market cap of the firm rose to Rs 57,352.68 crore.

The BSE Power index also hit an over 10-year high of Rs 3,008 in intra-day trade on Tuesday. Tata Power and Torrent Power gained over 4 per cent, each, on BSE.

The share of Adani Power stands higher than 5 day, 10 day, 20 day, 50 day, 100 day, and 200 day moving averages.

It has gained 285.6 per cent in the last 12 months and risen 198.5 per cent since the beginning of this year.

An investment of Rs 5 lakh in the stock a year ago would have grown to Rs 19.64 lakh today. 

Jatin Gohil, Technical and Derivative Research Analyst, Reliance Securities, told Business Today, “Electric utility space remained in focus with positive momentum and Adani Power has emerged as a top gainer in that space.

“Continuing its prior daily rising trend, the stock recorded a new high of Rs 151.50 today. It has given 6.5 time return from its lowest level of March 2020 (Rs23). Spike in volume and positively poised technical indicators signal that prevailing up-trend will continue,” he noted.

He further added that the stock will keep exploring uncharted territory and will move towards Rs 200 in the short term.

“The electricity generation is projected to grow by 5 to 7 per cent in FY22 from that in FY21,” CARE Ratings said in a recent power sector report.

The rating agency further said that the power generation and consumption is expected to improve in FY22 with the anticipated higher levels of economic activity amid optimism that the vaccination program would facilitate normalization and stimulate economic recovery. 

Adani Power posted a consolidated net profit of Rs 13.13 crore in the March 2021 quarter, mainly on account of higher revenues. The company had posted a consolidated net loss of Rs 1,312.86 crore in the quarter ended March 31, 2020, a BSE filing said.

For the entire fiscal year (2020-21), the company’s consolidated net profit stood at Rs 1,269.98 crore. It had reported a loss of Rs 2,274.77 crore in 2019-20.

Total income in 2020-21 came in at Rs 28,149,68 crore as compared to Rs 27,841.81 crore in 2019-20.

Gautam Adani, Chairman, Adani Group, said in the statement, “India is facing a renewed challenge in the form of a sudden surge of the Covid-19 pandemic. The Adani Group stands shoulder-to-shoulder with the nation in facing and surmounting this challenge.”

“We are expending all efforts to help India recover quickly and resume on its path to progress and prosperity for all. The Adani Group remains committed to sustainable growth of energy infrastructure and becoming a key contributor to the nation’s economic progress,” he added.

Adani Power (APL), a part of the diversified Adani Group, is the largest private thermal power producer in India.

The company has an installed thermal power capacity of 12,410 MW spread across six power plants in Gujarat, Maharashtra, Karnataka, Rajasthan, and Chhattisgarh, apart from a 40 MW solar power plant in Gujarat.  

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