Shares of Anil Ambani-owned Reliance Power have been on an upward trajectory since the company announced its board meeting to consider a fundraising proposal. The board meeting is scheduled for today, September 23, 2024. Ahead of the meeting, Reliance Power’s share price surged, opening higher and hitting an intraday high of RS 38.15 per share on the National Stock Exchange (NSE). During early trading, the stock touched the 5% upper circuit.
This marks the fourth consecutive session that Reliance Power shares have hit the upper circuit, following similar moves on Wednesday, Thursday, and Friday of last week. Furthermore, it is the eighth consecutive session of gains for the stock, highlighting strong investor sentiment.
The company’s market capitalization has surged to RS 15,328 crore. On the Bombay Stock Exchange (BSE), a total of 24.91 lakh shares were traded, resulting in a turnover of Rs 9.50 crore.
Fundraising Announcement
Reliance Power had earlier informed the stock exchanges about its plan to raise long-term resources, both from domestic and global markets. The company stated, “A meeting of the Board of Directors of the Company will be held on Monday, September 23, 2024, to consider and approve raising long-term resources by issuing equity shares, equity-linked securities, warrants convertible into equity shares, or other instruments through preferential issue, qualified institutional placement (QIP), rights issue, foreign currency convertible bonds (FCCBs), or other methods.”
The board is also expected to determine the issue price and seek necessary approvals from shareholders and regulators during today’s meeting.
This fundraising initiative aims to strengthen Reliance Power’s financial position, which could support its growth and expansion plans in the power sector. Investors are closely watching the outcome of the board meeting as the company looks to secure capital from a variety of sources.
Technical Outlook on RPower
Commenting on the technical outlook Anshul Jain, Head of Research at Lakshmishree Investment & Securities said that Reliance Power (RPower) has recently exhibited a notable breakout from a 180-day volatility contraction pattern, signaling the potential for a significant move. After consolidating at low volumes and with reduced volatility, the stock broke out around the Rs 33 level. However, due to the 5% circuit filter in place, trading volumes have remained limited, with the stock repeatedly hitting upper circuits post-breakout.
Jain also added that this technical breakout suggests potential upside targets of Rs 54, aligning with the pattern’s projections. Despite the promising breakout, investors should approach this stock cautiously, as concerns over the quality of management remain. Taking small long positions with a target of Rs 54 could be a viable strategy, but heavy exposure is not advisable until further clarity on governance is established. The current scenario favors a watchful approach, balancing potential gains with careful risk management.
Reliance Power Stock Performance in Last One Year
In terms of stock performance, Reliance Power shares have demonstrated positive returns across multiple time frames. Over the past month, the stock has given a commendable 10.64% return, showcasing its stability and growth potential. The last six months have seen even more impressive results, with a substantial increase of 38.22%, indicating a strong upward trend.
Year-to-date, Reliance Power shares have surged by 59.29%, reinforcing the stock’s positive momentum in the current fiscal year. Looking at the broader picture, the stock has delivered an impressive return of over 101.32% in the last twelve months, emphasizing its sustained growth and attractiveness to investors.
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