8 hrs ago
Adani Power Profit Surges as Brokerages See Further Upside
Adani Power is a company whose stock has risen strongly over the past few years.
Its profit in the latest quarter was 42% higher than in the same period a year earlier.
Its revenue also grew by 34%.
The company plans to raise as much as Rs 15,000 crore by selling shares through a QIP.
Several brokerages believe the stock could rise further.
Their price targets range from Rs 220 to Rs 282.
A technical analyst expects the stock to trade between Rs 202 and Rs 216 in the short term.
The stock was trading at Rs 207.95 during the reported session.
Adani Power’s first-quarter net profit rose 42% to Rs 4,805.69 crore.
Quarterly revenue increased 34% to Rs 18,901 crore, according to the report.
The company’s board approved raising up to Rs 15,000 crore through a QIP.
The stock traded 1.56% higher at Rs 207.95, with its market capitalization reaching Rs 4 lakh crore.
Brokerage targets range from Rs 220 to Rs 282, while the Bloomberg consensus target is Rs 252.30.
- Who
- Adani Power, along with analysts and brokerages covering its stock.
- What
- The company reported higher first-quarter profit and revenue, while analysts issued varying price targets.
- Where
- The company’s reported operations include its Raipur complex; the stock was discussed in the Indian market using rupee-denominated prices.
- When
- In the reported trading session and the company’s latest first quarter.
- Why
- Higher profit, revenue growth, project execution and its project portfolio supported the positive brokerage views.
Cautious and Short-Term View
Positive and Longer-Term View
Near-term trading range
Cautious and Short-Term View
Anand Rathi’s Jigar S. Patel identified support at Rs 202 and resistance at Rs 211, expecting the stock to remain within Rs 202-Rs 216 in the short term.
Positive and Longer-Term View
A decisive move above Rs 211, according to the same technical view, could open the way toward Rs 216.
Price-target expectations
Cautious and Short-Term View
Bernstein’s Rs 220 target and ICICI Securities’ Rs 233 target indicate more limited upside than the highest broker estimates.
Positive and Longer-Term View
Targets are higher at Rs 240 from IIFL, Rs 257 from JM Financial, Rs 270 from Jefferies and Rs 282 from Antique Stock Broking; the Bloomberg consensus target is Rs 252.30.
Investment rationale
Cautious and Short-Term View
The differing targets and short-term range show that analysts do not agree on the extent or timing of further gains.
Positive and Longer-Term View
Brokerages citing a positive case point to Adani Power’s healthy project portfolio, swift execution and strong quarterly earnings.
Key facts
- Three-year stock return
- 182%
- Six-month stock gain
- 50%
- Q1 net profit
- Rs 4,805.69 crore, up 42%
- Q1 revenue
- Rs 18,901 crore, up 34%
- Fundraising plan
- Up to Rs 15,000 crore through a QIP
- Reported stock price
- Rs 207.95, up 1.56%
- Bloomberg consensus target
- Rs 252.30, implying 23.40% potential upside
Quotes
Jigar S Patel
Anand Rathi analyst providing technical levels and a short-term trading range for Adani Power.
“Support is placed at Rs 202 while resistance stands at Rs 211. A decisive breakout above Rs 211 could open the door for further upside towards Rs 216. For the short term, the stock is expected to trade within the Rs 202-216 range.”
businesstoday.in
Sources
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