Adani Power shares fall 46% from record high but ICICI Securities is bullish, here's why 

Shares of Adani Power Ltd have lost 46% lower from their record high but ICICI Securities is positive on the recovery. Adani Power stock reached a record high of Rs 896.75 on June 3, 2024. However, it is trading at Rs 482.30 in the current session. The brokerage said legal disputes on power purchase agreements (PPAs) are largely resolved with Adani securing compensation and higher tariffs. ICICI Securities has assigned a price target of Rs 600, a 24% upside to the current price. 

Balance sheet of Adani Power has strengthened via promoter fund infusion, debt reduction, and cash utilisation, ICICI Securities said, adding that the Adani Group firm is acquiring and turning around stressed coal plants amid rising demand and ordering 11GW new capacity.

Market cap of the firm stood at Rs 1.86 lakh crore. A total of 1.67 lakh shares of the Adani Group firm changed hands amounting to a turnover of Rs 8.10 crore on BSE.

In terms of technicals, the Adani Group stock is trading neither in the oversold nor in the overbought zone, signals the relative strength index (RSI) of Adani Power, which stands at 44.2.

Adani Power stock is trading lower than the 5 day, 10 day, 20 day, 30 day, 50 day, 100 day, 150 day and 200 day moving averages. 

Jigar S Patel from Anand Rathi said, "Support will be at Rs 470 and resistance at Rs 500. A decisive move above the Rs 500 level may trigger a further upside of Rs 530. The expected trading range will be between Rs 470 and Rs 530 in the short-term."

AR Ramachandran, SEBI registered independent analyst says, "Adani Power is bearish on the Daily charts with strong resistance at Rs 497. A daily close below the support of Rs 470 could  lead to a target of Rs 438 in the near term."

Global brokerage Jefferies has a buy call with a target price of Rs 660 on the Adani Power stock. 

Adani Power is on its journey to raise capacity by 1.7 times from 17.6 GW to 30.7 GW by 2030. Land requirements and financing plans are in place. Close coordination with BHEL for equipment delivery and in-house EPC are ensuring capex is on schedule, it said.

"Thermal capacity in an overall peak deficit scenario with merchant exposure is positive," it said while initiating coverage with a 'buy' and a target price of Rs 660. The foreign brokerage firm expects past power Purchase Agreement issues returning and affecting EBITDA; lower merchant realisations; demand disappointment; and payment delays for 1.6 GW Godda power plant as key risks for the company.