Reliance Power share price soars 29% in March; should you buy this Anil Ambani-owned ADAG stock? | Stock Market News

Reliance Power share price has been on a roll this month. This Anil Ambani-owned ADAG stock has soared 29 per cent in March after witnessing a significant loss of 17 per cent in February and a 6 per cent fall in January. On Friday, March 28, the stock closed flat at ₹42.98 on the NSE.

Reliance Power share price trend

The ADAG (Anil Dhirubhai Ambani Group) stock exhibited a strong rebound in March after two months of losses.

Over the last year, Reliance Power’s stock price has seen a solid gain of 52 per cent compared to a 5 per cent gain in equity benchmark Nifty 50.

The power stock hit a 52-week high of ₹53.64 on October 3 after hitting a 52-week low of ₹23.30 on June 5 last year.

Should investors buy Reliance Power stock?

Experts attribute the recent rally in the stock to a comfortable valuation and improved growth outlook.

Nitin Kotiyal, a senior research analyst at Fynocrat Technologies, pointed out that the company’s thermal power plants are performing well, making them some of the top-performing thermal plants in India.

The company is also focusing on clean energy and forming strategic joint ventures to expand its business. As part of this, its subsidiary has won a major solar and battery storage project, which will be one of the largest in Asia.

Additionally, Kotiyal underscored Reliance Power’s plans to invest in green energy projects in Andhra Pradesh, strengthening its push towards renewable energy.

The company has recently taken steps to reduce its debt.

Kotiyal highlighted that with the sale of Reliance Capital to IndusInd International Holdings(IIHL), its debt-to-equity ratio has improved from 1.61 to 0.86.

However, Kotiyal underscored despite claims that the company is now debt-free, it still holds ₹250 crore in non-convertible debentures (NCDs) as per the recent financials for Q3FY25.

Additionally, Kotiyal highlighted that the company plans to issue foreign currency convertible bonds (FCCBs), which would further increase its debt in the future.

However, the company has also improved its debt service coverage ratio and interest coverage ratio from earlier levels, indicating a better ability to meet its debt and interest obligations, said Kotiyal.

“While Reliance Power seems to be moving in the right direction, there is still a long way to go. It would be wise for investors to wait for clearer signs of a turnaround before considering an entry into the stock. As the markets gear up for the next rally, there are many other stocks in the same sector that may offer better investment opportunities,” Kotiyal said.

Technical experts also appear cautious about the stock at the current juncture.

Jigar S. Patel, Senior Manager of Equity Research at Anand Rathi Share and Stock Brokers, pointed out that recently, the stock now hovers near a critical resistance zone.

“A bearish alternate bat pattern has emerged on the daily chart, accompanied by a shooting star-like candle near the R5 monthly Camarilla pivot. The previous top lies in the same vicinity, warranting caution,” said Patel.

“On the indicator front, RSI has formed a negative hidden divergence, with RSI making higher highs while price action fails to follow. Hence, we advise traders to book profits in the ₹42-44 zone or on any bounce. Fresh buying is recommended only above a ₹45-weekly close,” Patel said.

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Disclaimer: This story is for educational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions, as market conditions can change rapidly, and circumstances may vary.