Adani Power shares hit record high on deal to buy DB Power

Shares of Adani Power hit an all-time high today after the Adani Group firm said it would buy DB Power Ltd for an enterprise value of Rs 7,017 crore.

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The stock touched a record high of Rs 429.65, up 3.83 per cent from its previous close of Rs 412.20. A total of 13.97 lakh shares of the firm were exchanged.

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Adani Power's stock is higher than the 5-day, 20-day, 50-day, 100-day and 200-day moving averages. The stock has risen 450.87 per cent in one year and 327.72 per cent in 2022.

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Adani Power aims to expand its offering and operations in the thermal power sector in Chhattisgarh. DB Power owns and operates two units of a 600 MW thermal power plant in Chhattisgarh's Janjgir Champa district.

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The initial period of the MoU of this acquisition will be till October 31, 2022, but it can be extended on a mutual agreement, the firm said in a filing to the exchanges.

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Adani Power will hold 100 per cent of DPPL's total issued, subscribed and paid-up equity share capital and preference share capital. While at the conclusion DPPL will hold 100 per cent of the DB power

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DB Power, which was incorporated in October 2006, is engaged in the business of setting up, operating and maintaining a thermal power generating station in Chhattisgarh.

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"Even though fundamentally, Adani Power has shown considerable improvement in its financial position, the stock is highly valued and over-buyered in every way," said Pavitra Shetty, co-founder and trainer, Tips2 Trades.

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