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.
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.
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.
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.
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.
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
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.
"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.