This largecap power stock surged 370% from 52-week low

Shares of Adani Power, a subsidiary of business conglomerate Adani Group, have rallied 370% in the last one year, from its 52-week low of ₹69.95 on August 24, 2021, to ₹328.60 on August 8, 2022. The largecap stock, with a market capitalisation of ₹1,26,739 crore, hit an all-time high of ₹354 on August 4, 2022, after the company reported robust earnings for the April-June quarter of the current fiscal.

An amount of ₹1 lakh invested in the Adani Group stock one year ago would have turned into ₹4.7 lakh today. In comparision, Sensex has surged over 8% during this period.

The shares of the private power producer has given a stellar return of 224% in the calendar year 2022, with the stock price climbing from ₹101.3 on January 3 to ₹328.60 on Monday. In the last one month, the stock has risen 15%, while it has given flat returns in the last one week. In the long term horizon, the stock has delivered 449% returns in 3 years, 938% in 5 years, and 670% over a 10 years period.

Adani Power shares turned ‘Bullish’ from ‘Mildly Bullish’ on August 2, 2022, at ₹328.65, as per research platform MarketsMojo. It trades higher than 20-day, 50-day, 100-day, and 200-day moving averages but lower than 5-day averages.

The recent rally in Adani Power shares can be attributed to strong financial performance. The company reported multi-fold growth in June quarter earnings as a nation-wide heatwave and broadening of the recovery in economic activity continued to drive electricity demand growth during the period under review. However, high import coal prices in the backdrop of domestic coal shortage impacted the earnings.

For the April-June quarter of the current fiscal (Q1 FY23), the power major reported a 17-fold year-on-year (YoY) jump in consolidated profit at ₹4,780 crore, aided by strong revenue, other income, and operating performance. On a sequential basis, the profit rose 2.9% from ₹4,645.5 crore in the March quarter of 2022 (Q4 FY22). The consolidated revenue from operations soared by 109% YoY and 29.5% sequentially to ₹13,723 crore during the quarter under review.

The consolidated EBITDA for Q1 FY23 was at ₹7,506 crore as against ₹2,292 crore in the year-ago period, up 227%, which includes prior period revenue recognition of ₹4,212 crore versus ₹657 crore during the respective periods.

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 13,610 MW spread across seven power plants in Gujarat, Maharashtra, Karnataka, Rajasthan, Chhattisgarh, and Madhya Pradesh, apart from a 40 MW solar power plant in Gujarat.