Adani Power shares surge, up 13% in a week: What’s next?

Shares of Adani Power rose over 2% on Tuesday, extending gains amid multiple tailwinds and strong technical support. The stock had risen 13% in the past week to hit a four-month high.

After a sharp rally on Monday following a letter from Maharashtra State Electricity Distribution Company (MSEDCL) for a 1,600 MW thermal power supply order, the stock closed at Rs. 157.44, the highest level since November.

Rising expectations of higher power demand are boosting stocks further as temperatures are likely to remain above normal this summer.

Kunal Kamble, senior technical research analyst at Bonanza, said the technical structure of Adani Power shares is also showing signs of bullish momentum as the stock tries to breakout from the downward trendline formed in the last few months.

“The price bounced strongly from the rising trendline support near 136 and is now trading above key short-term moving averages, indicating an improvement in strength. The recent bullish candlestick supported by increased volume reflects fresh buying interest. Further, the RSI has moved above the 60 level, indicating strong momentum,” he added, adding that advertisers had announced Rs5. Rs. Stop loss at 145.

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Adani Power received an order for 1,600 MW

In an exchange filing on Sunday, the company said the power will be supplied from its upcoming ultra-supercritical thermal power projects (USCTPP). The LoA follows Adani Power emerging as the lowest tariff bidder, at Rs. quoting a combined tariff of 5.30 per kWh.

The 25-year Power Supply Agreement (PSA) is expected to commence in FY31.

“This achievement marks another PSA win for APL during a period of renewed upswing in investment in the thermal power sector. Adani Power has established itself as a leading provider of new generation capacity, supporting the nation’s goal of adding 100 GW of thermal power capacity by 2032. During FY25-26, APL has won five-com-BMSAs with a long-term capacity of P-com-25-26-26. 10,400 MW,” The company said in its exchange filing.

Adani Power CEO S.B. As India’s power demand continues to grow, adding long-term and reliable capacity is critical to ensure energy security, said Khartia.

“This LoA of MSEDCL reflects the competitiveness of Adani Power’s cost structure, our ability to deliver reliable baseload power and our commitment to support India’s growing electricity needs through long-term partnerships. As India’s leading private power producer, we look forward to supporting Maharashtra and the country’s ambitious development goals with reliable and CEO supply.”

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With the latest LoA, Adani Power has now tied up a long-term PSA of 13.3 GW from its 23.8 GW under-implementation pipeline. The company said this is an important step towards its stated objective of securing almost its entire capacity under such contracts. Over 95% of Adani Power’s current operating capacity of 18.15 GW is now tied up under a medium to long-term PSA, while over 55% of its upcoming capacity of 23.8 GW is secured under a 25-year PSA.

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