Adani Power has witnessed a massive rise in its share prices after incorporating a new unit in the Middle East. Its share prices have surged 1.56% at INR 671.75 per share on the BSE on intraday deals. This came right after Adani Power incorporated the wholly-owned subsidiary Adani Power Middle East in Abu Dhabi on 26th August 2024. Adani Power Middle East has an authorised capital of 27,000 shares. Each of these shares was valued at 1 USD earlier. On 22nd August 2024, the company received another good news when the Hyderabad bench of the National Company Law Tribunal (NCLT) approved Adani Power’s INR 4,101 crore resolution plan to acquire Lanco Amarkantak Power Limited. The rise in share values has caused the global conglomerate to rise above the Adani Debt. It has also been able to build itself an incredible position in the country’s power sector.
How Will Adani Power’s New Acquisition Benefit Its Business?
The Adani Group has already been doing remarkably well in the power sector. With this recent acquisition, it has been able to further extend its hold over the power sector and build itself an incredible reputation in the business world. The company has also managed to earn excellent revenue for itself from various business operations. The rumours surrounding Adani Case have also subsided. LAPL is currently undergoing the corporate insolvency resolution process under the insolvency and bankruptcy code. This is expected to be completed by 20th October 2024. This is within 60 days from the date of NCLT’s approval order.
The Revenue Generated In The Present Quarter:
During the April to June quarter of FY 24-25, Adani Power reported a 55% drop in its consolidated net profit for the June quarter. This points to a value of INR 3,913 crore compared to INR 8,759 crore in the year-ago period. This decline has been mainly because of the rising expenses. The company’s total income for the April to June quarter fell to INR 15,474 crore. This is down from INR 18,109 crore in the previous year. The expenses also reached INR 10,568.44 crore from INR 9,309.394 during the year-ago period. Despite all these financial challenges, the Adani Group’s consolidated power sales volume increased by 38%. It reached 24.1 billion units in quarter one of FY25 in comparison to 17.5 BU in quarter one of FY24. This has been mainly because of the excellent operational capacity and the rising power demands in the country.
The Reason Behind Incorporating A New Subsidiary In The Power Sector:
Adani Power had incorporated the wholly owned subsidiary to invest in power infrastructure and related fields. The authorised capital of Adani Power Middle East is 27,000 USD. Adani Power owns 100% shares of the new subsidiary. The company already has a power generation capacity of 15,250 MW. It is the largest private thermal power producer in India. The company operates thermal power plants across several major states in India including Rajasthan, Maharashtra, Karnataka, Chhattisgarh, Jharkhand, and Madhya Pradesh. APL also has a 40 MW solar power project in Gujarat. The company claims to be the first company globally to establish a coal-based critical thermal power project which is registered under the Kyoto Protocol’s Clean Development mechanism.
Upcoming Plans For The Future:
Adani Power Limited and its subsidiary Mahan Energy Limited have also recently entered into a contract with Bharat Heavy Electrical Limited. This contract is valued at INR 11,000 crore. This is being done to further boost its power generation capacity. The company is about to develop three supercritical thermal power projects under the contract. The contract also includes the supply of critical equipment and supervision of the erection and commissioning processes of the various projects. Each project is expected to have a capacity of 2×800 MW. It will utilise ultra-supercritical technology. The projects are planned to be developed in three different sites: Kawai Phase-II and Kawai Phase-III in Rajasthan, and Mahan Phase-III in Madhya Pradesh.
Conclusion:
Over the span of the past few years, the Adani Group has taken up various incredible ventures in the power sector. This has given our country’s power generation capacity an excellent boost. The overall rumours with Adani Case has also been reduced with their exponential growth. We expect the Adani Group to take up more such ventures in the upcoming years as well which will meet our ever-growing power demands.
