Reliance Power stock jumps 100% in 3 months: A turnaround or another bubble?

After 17 years, Reliance Power is back in the spotlight with a 100% rally in just three months. This mirrors the frenzy of February 11, 2008, when the company made its debut with a blockbuster IPO of Rs 11,563 crore. At that time, India's power sector was booming, and Reliance Power was raising funds for the country's biggest 28GW power development. However, it was also the time when the subprime financial crisis was starting to unfold in the US.
The current environment resembles that of 2008. The US economy faces potential disruptions due to tariffs and geopolitical stress, while India's green energy projects are moving ahead due to government subsidies. Renewable energy IPOs are on the rise, and companies like Suzlon Energy have turned their fate around in this cyclical upturn.
Investor optimism isn't limited to Reliance Power. RattanIndia Power's shares jumped 36% in under a week.
Reliance Power and RattanIndia Power Stock Price Momentum Between May and June 2025
Meanwhile, Reliance Home Finance, another Anil Dhirubhai Ambani Group (ADAG) firm, rallied 115% in a month, fueled by speculation around a potential comeback of Reliance Power.
So, the key question arises: Is this market reaction backed by fundamentals, or is it just another bubble?
As per media reports, order wins, debt cleanup, settlement of legal cases, and fresh funding have raised the hopes of a turnaround and are driving Reliance Power's share price. But is this enough, given the near insolvency of parent Reliance Infrastructure and the group's corporate governance issues?
Searching for value, we will look at each of the reasons and identify if it justifies the stock price.
Are project wins a sign of a turnaround?
Not necessarily. Reliance Power is no stranger to winning big orders. Its IPO aimed to raise money for 12 projects with a combined installed capacity of 28GW, the largest in the country at the time. However, prolonged delays and legal issues related to its power projects resulted in the company having enormous debt.
In 2010-11, Reliance Power's 2,400 MW gas-based thermal power plant in Samalkot, Andhra Pradesh, failed due to a natural gas shortage. The company was left with Rs 2,500 crore in debt from the Export-Import Bank of the United States, which it settled in December 2024. Reliance Power had a long list of such projects that piled up bank debt, which it has been settling for the past few years by selling assets.
Now, Reliance Power is trying its hand at large-scale solar and battery energy storage system (BESS) projects.
Reliance Power project wins in 2025
Nature of client
Client
Project Size
Investment
PSU
SJVN
350 MW solar-BESS
–
PSU
Solar Energy Corporation of India
465 MW solar and 1.86 GW BESS
Rs 10,000 crore
Bhutan Government
Druk Holding and Investments
350MW solar and 175MW BESS
Rs 2,000 crore
Source: Press Releases
The timely execution of these projects within the budget and operational efficiencies will determine whether contract wins are good news for shareholders.
Reliance Power's share price surged after the company announced that it has 'zero bank debt and no default' in its Q4 FY25 earnings released on May 9. This is a significant milestone, considering its recent escape from insolvency proceedings, unlike other ADA group companies (Reliance Capital and Reliance Naval and Engineering).
The turnaround has come through equity dilution. Debt has been converted into shares and warrants, and subsidiaries have been sold off as lenders liquidated pledged shares. For instance, the Rs 3,872 crore loan guaranteed for Vidarbha Industries Power (VIPL) was resolved in September 2024 via pledged share sales.
Every time Reliance Power reduced its debt, the company's share price showed a remarkable jump.
Reliance Power's 5-Year Stock Price Momentum
Factors Driving Reliance Power's Stock Price Momentum
Period
Reliance Power Share Price Rally
Reason for rally
9-May to 11-Jun 2025
84%
No Bank debt
13-Sep to 4-Oct 2024
70%
Settled VIPL guarantee
15-Mar to 5-Apr 2024
47%
Debt Settlement with ICICI Bank
27-Oct-2023 to 5-Jan-2024
87%
Consolidated net loss narrowed to Rs 237.76 crore in Q2 FY24 and Rs 1,000 crore preferential raising
19-May to 16-June 2023
40%
Made a Rs 1,200 crore one-time settlement offer to lenders of VIPL
19-Feb to 18-Jun 2021
411%
Reduced debt
Source: Media reports and company statements
But does it mean Reliance Power's troubles are over? Not exactly. The company has converted most of its debt to equity and convertible warrants. Equity will dilute when these warrants are exercised, thereby reducing its earnings per share (EPS).
As of now, Reliance Power has over Rs 15,153 crore debt on its balance sheet, which is 0.88x its equity as on March 31, 2025.
Debt clean-up is a sign of turnaround. However, its impact on stock price could fade because of equity dilution.
What about the future rally?
Beyond debt reduction, the focus may now shift to sustainable earnings per share (EPS). Thus, stock price rally could be driven by future operational efficiency rather than simply a 'clean-up act' for past inefficiencies.
In the case of Suzlon, the stock price rally was driven by revenue and EPS growth from wind turbine orders, which have a faster cash conversion cycle. Reliance Infrastructure has announced plans to enter solar and battery manufacturing. This is one area investors could look forward to, as backward integration could help Reliance Power secure equipment supply at a lower cost.
However, competition is intensifying. Companies like Waaree Energies and Premier Energies, both publicly listed, are expanding rapidly with clean balance sheets and vertically integrated models. Many PLI-backed firms are also entering both manufacturing and generation.
Reliance Power's success is tied to Reliance Infrastructure. When Reliance Power wins a power project, it awards an engineering, procurement, and construction (EPC) contract to Reliance Infrastructure. Reliance Infrastructure has built Reliance Power's flagship 3.96 GW Sasan Ultra Mega Power Plant in Madhya Pradesh, Butibori plant in Nagpur, among others. While inter-group contracts bring efficiency, they also tie them to others' problems. Hence, it becomes imperative to analyse the situation of Reliance Power and Reliance Infrastructure simultaneously.
The Anil Dhirubhai Ambani Group had Reliance Commercial, Reliance Capital, Reliance Naval and Engineering, all of which were sold in insolvency proceedings. As for Reliance Home Finance, promoter holdings have dropped to 0.74%. While the group still holds Reliance Communications, it has been selling communications assets to Jio.
What is left of the ADA Group is Reliance Power and Reliance Infrastructure. All hopes of a turnaround depend on these two companies. Hence, their share prices move in sync.
ADA Group is riding on investors' hopes of positive returns. With a net worth of Rs 16,337 crore and a market cap of Rs 27,291 crore, Reliance Power has a price-to-book value (P/BV) of 1.65x. It is relatively higher than RattanIndia Power's P/BV of 1.55x but lower than NTPC's 1.75x. Although NTPC has a higher ratio, its fundamentals are way better than Reliance Power's, making the latter look expensive.
Small brokerages and individual investment companies remain cautious. A market correction is likely as short-term investors book profits.
The two stocks are riding on order wins. A significantly large EPC order book will require huge working capital. For the stocks to sustain their rally, the company has to achieve smooth execution of projects, and the economic conditions have to remain favourable.
Reliance Power and Reliance Infrastructure are stocks to keep an eye on for their turnaround signs, but also be cautious for red flags that could disrupt the recovery.
Note: We have relied on data from www.Screener.in throughout this article. Only in cases where the data was not available, have we used an alternate, but widely used and accepted source of information.
Puja Tayal is a financial writer with over 17 years of experience in the field of fundamental research.
Disclosure: The writer and his dependents do not hold the stocks discussed in this article.
The website managers, its employee(s), and contributors/writers/authors of articles have or may have an outstanding buy or sell position or holding in the securities, options on securities or other related investments of issuers and/or companies discussed therein. The content of the articles and the interpretation of data are solely the personal views of the contributors/ writers/authors. Investors must make their own investment decisions based on their specific objectives, resources and only after consulting such independent advisors as may be necessary.

Try Our AI Features

Explore what Daily8 AI can do for you:

Learn with AIFact CheckingText to SpeechAI Summary

Related Articles

The Wire

28 minutes ago

• The Wire

RBI's Rs.10 Lakh Crore Credit Unlock a Major Boost for the Sustainable Blue Economy: Kings Infra

Kochi, 23rd June 2025: Kings Infra Ventures Ltd. welcomes the Reserve Bank of India's decisive policy to reduce provisioning norms for infrastructure lending — a silent yet powerful enabler that unlocks over Rs.10 lakh crore in credit for India's future-ready sectors. This reform comes at a pivotal time for India's infrastructure ambitions — especially in nutritional infrastructure, a new and urgent category focused on building clean, sustainable, and traceable food systems. As a leading developer of land-based aquaculture and seafood supply chains, Kings Infra is uniquely positioned to leverage this opportunity. 'This reform is a silent catalyst,' said Mr. Shaji Baby John, Chairman of Kings Infra. 'It gives us the financial flexibility to fast-track our aquaculture infrastructure, unlock value from our land banks, and contribute significantly to India's Blue Economy and food security goals.' Through its subsidiary Kings Maritech Eco Parks Ltd. (KMEPL), the company is building large-scale, ESG-aligned aquaculture clusters — combining hatcheries, precision farm units, cold-chain logistics, and export hubs across Tamil Nadu, Kerala, and Karnataka. The RBI's move to reduce provisioning for under-construction infrastructure from 5% to just 1% is expected to: • Free up capital for faster rollout of sustainable infrastructure • Improve bankability of greenfield aquaculture and logistics projects • Accelerate land monetization across Kings Infra's coastal land portfolio This also strengthens Kings Infra's strategic roadmap to transform underutilized coastal lands into high-impact assets supporting: • Clean protein exports • Climate-resilient farming systems • Rural employment • Nutritional self-sufficiency As India powers ahead with its Rs.1.4 trillion National Infrastructure Pipeline, this credit unlock ensures that blue economy sectors — from mariculture and clean aquaculture to traceable seafood exports — receive the financial backing they need. Kings Infra is actively engaging with institutional investors, sustainability-focused funds, and strategic partners to co-develop this next generation of aquaculture infrastructure. (Disclaimer: The above press release comes to you under an arrangement with NRDPL and PTI takes no editorial responsibility for the same.).

Time of India

33 minutes ago

• Time of India

Neetu Yoshi IPO opens June 27, price band fixed at Rs 71-75. Check details

The initial public offering (IPO) of metallurgical engineering company Neetu Yoshi will be available for public bidding from Friday, June 27 and the company has fixed a price band of Rs 71-75 for this issue. The company aims to raise Rs 77.04 crore (at the upper end of the price band), with its shares proposed to be listed on the BSE SME platform. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like The World's Most Stunning Blue Flag Beaches Ranked: Top 25 List! Read More Here are the key details you need to know: Neetu Yoshi IPO size The issue size is 1,02,72,000 equity shares at a face value of Rs 5 each with a price band of Rs 71 - Rs 75 per Share. As part of the equity share allocation structure, up to 29,20,000 equity shares have been reserved for the anchor investor portion. The Qualified Institutional Buyer (QIB) category may be allocated up to 19,52,000 equity shares. Live Events A minimum of 14,65,600 equity shares will be allotted to Non-Institutional Investors (NIIs), while retail individual investors (RIIs) will receive not less than 34,14,400 equity shares. Additionally, up to 5,20,000 equity shares have been earmarked for the market maker category. Net proceeds from the Neetu Yoshi IPO The net proceeds from the IPO will be utilized for the setting up of a new manufacturing facility and for general corporate purposes. Book running lead managers of Neetu Yoshi IPO The Book Running Lead Manager to the Issue is Horizon Management Private Limited, and the Registrar to the Issue is Skyline Financial Services Private Limited. About the company Neetu Yoshi Ltd is a metallurgical engineering company manufacturing critical safety spares for railways. The products include mild steel, spheroidal graphite iron, cast iron, and manganese steel (0.2 kg to 500 kg). The Company is an RDSO-certified vendor supplying 25+ critical safety spare parts for Indian Railways, specializing in braking solutions, suspensions, propulsion aids and coupling attachments. The company has established a Class 'A' RDSO-certified manufacturing facility in Bhagwanpur, Uttarakhand, spanning 7,173 sq. meters with 8,087 MTPA capacity. With advanced infrastructure, in-house testing, and a strategic location, the company delivers precision-engineered, high-quality metallurgical products at competitive prices. As a late mover, Neetu Yoshi leverages advanced technology, CNC precision, and cost-efficient processes to gain a competitive edge while developing next-gen railway solutions. Neetu Yoshi financial performance In FY24, the company achieved a revenue of Rs 4,733.42 lakh, EBITDA of Rs 1,718.57 lakh, and a PAT of Rs 1,257.72 lakh. For the nine-month period ended December 31, 2024, the company achieved a revenue of Rs 5,136.08 lakh, EBITDA of Rs 1,684.89 lakh, and a PAT of Rs 1,199.24 lakh.

India Today

37 minutes ago

• India Today

iPad Air M3 and iPad 11 now selling at a lower price in India

Apple's latest set of iPads is selling at a lower price in India, which might be a little hard to believe for some, because discounts on new devices rarely happen. While many have started seeing deals on iPhones just a few months after their launch events, we are now witnessing something similar for iPads as well. The iPad Air M3, as well as the iPad 11, were recently introduced in India, and these models are now available on Amazon with big discount offers. Here are the Air M3 and iPad 11 now selling at a lower price in IndiaThe iPad Air M3 is currently selling at Rs 55,999 on both Flipkart and Amazon. This is down from its launch price of Rs 59,900. This clearly shows that these platforms are giving a flat discount of Rs 3,901. In addition to this, one will also find an extra Rs 3,000 discount on the ICICI, Kotak and Axis. This will effectively reduce the price to Rs 52,999. So, one is getting a discount of Rs 6,000, which is not a bad deal for those who are always on the lookout for discount offers on iPads. Also, this is a steal for people because they are able to buy this 3-month iPad at a more accessible price. The mentioned price is for the 128GB storage model with Wi-Fi for the iPad 11, the device is selling on these platforms for Rs 31,999. For your reference, this iPad was launched in India at Rs 34,900. This means that users are getting a flat discount of Rs 2,901. You will also find an extra Rs 2,000 discount on similar bank cards that we have mentioned above. This will effectively reduce the price to Rs 29,999. This means that consumers are getting almost Rs 5,000 discount on this iPad version, which was announced in March iPad Air M3 worth buying?advertisement Apple says its new M3 chip delivers a big performance leap over older models. Compared to the M1, it's nearly twice as fast, and it's significantly quicker than iPads powered by the A14 Bionic. This added power makes the iPad Air M3 suitable for users who want to do tasks like editing videos, creating content, or playing advanced games. People who have been using iPads with older chipsets should consider upgrading to the Air M3 model, but Air M2 users should skip this the performance has taken a clear step forward, the overall design of the iPad Air hasn't changed much. Just like the M2 model, the M3 version continues with Touch ID embedded in the power button and has the same clean, lightweight build. But those looking for advanced features will still find the iPad Pro a step iPad Air, for instance, skips on Face ID — a feature that makes unlocking the device more seamless — and also misses out on the dedicated function row on the Magic Keyboard, something the iPad Pro offers. For users who frequently adjust volume, brightness, or media controls through physical keys, this absence might be a slight has, however, launched a refreshed Magic Keyboard for the iPad Air alongside the new model. While it carries a similar look and layout to the one made for the iPad Pro, the build quality isn't as premium. That said, it does include a 14-key function row, giving users quick access to useful display experience on the iPad Air M3 remains unchanged from the previous model. The 11-inch version still supports up to 500 nits of brightness, while the larger 13-inch model goes up to 600 nits. Both screens support True Tone and P3 Wide Colour, offering vibrant visuals with colour the camera side, Apple continues to offer capable hardware. The front camera is a 12-megapixel ultra-wide sensor that supports Center Stage, which keeps the user in the frame during video calls. The rear camera is also 12MP and can shoot 4K videos at 60fps, along with slow-motion clips at 1080p and short, the iPad Air M3 offers a significant speed upgrade while keeping most other things familiar when compared with the older iPad Air models. It's a reliable option for users who want pro-like performance without stepping into iPad Pro territory.