Reliance Power Ltd shares continued their strong upward move for the fourth consecutive session in Wednesday's trade. The stock jumped 5 per cent to hit a one-year high of Rs 36.17. At this price, it has gained 21.50 per cent in four trading days.
The counter has been buzzing after it was reported that Adani Power had begun talks to acquire a thermal power project in Nagpur once owned by Anil-Ambani's bankrupt Reliance Power.
Analysts largely remained positive on RPower's stock for the near term. Kranthi Bathini, Director of Equity Strategy at WealthMills Securities, said, "The counter has been buzzing after a recent news report claimed that Adani Power was in talks to buy Reliance Power's 600 MW thermal plant in Nagpur. It is one of the momentum stocks right now."
Investors with a high-risk appetite can hold on to the stock. Fresh buying is not advised at current levels, Bathini mentioned.
On the technical front, near-term support on the counter could be seen at Rs 32 level. With that being said, resistance may be found in the Rs 38 range.
Osho Krishan, Senior Research Analyst - Technical & Derivatives at Angel One, said, "Currently, the counter is placed at a crucial juncture of a multi-week breakout and a sustainable follow-up buying emergence is likely to trigger the next round of rally in the counter for the Rs 42-45 zone in the comparable period. On the lower end, a series of support zones are placed near the Rs 32-30 sub-zone."
Ravi Singh, Senior Vice-President (Retail Research) at Religare Broking, said the stock has potential to hit an upside target of Rs 38.
Jigar S Patel, Senior Manager - Technical Research Analyst at Anand Rathi Shares and Stock Brokers, also suggested that the counter can see Rs 38 level. The expected trading range will be between Rs 40 and Rs 30 for the short term, Patel added.
The counter traded higher than the 5-day, 10-, 20-, 30-, 50-, 100-, 150-day and 200-day simple moving averages (SMAs). The stock's 14-day relative strength index (RSI) came at 67.82. A level below 30 is defined as oversold while a value above 70 is considered overbought.
As per BSE, the company's stock has a price-to-equity (P/E) ratio of 203.03 against a price-to-book (P/B) value of 1.47. Earnings per share (EPS) stood at 0.17 with a return on equity (RoE) of 0.73.
Around 60.07 lakh shares were seen changing hands on BSE today. The figure was lower than the two-week average volume of 82.16 lakh shares. Turnover on the counter came at Rs 21.64 crore, commanding a market capitalisation (m-cap) of Rs 14,529.38 crore.
The company said its consolidated net loss narrowed to Rs 97.85 crore during the June 2024 quarter (Q1 FY25), on account of improved income. It had reported a loss of Rs 296.31 crore in the April-June period of the preceding 2023-24 financial year. It increased its total income to Rs 2,069.18 crore from Rs 1,951.23 crore in the year-ago period.
As of June 2024, promoters held a 23.24 per cent stake in the firm.