Adani Power shares hit upper circuit, stock up 14% in 3 sessions to hover around record high

Shares of Adani Power Ltd on Tuesday extended their upward run for the third straight session. The stock jumped 5 per cent to hit its upper price band of Rs 588.35. At this price, it has soared 13.90 per cent in three trading days. The scrip was just 0.16 per cent away from its lifetime high of Rs 589.30, a level seen on December 6 last year.

The counter recently gained traction following the company's announcement on Mukesh Ambani-led Reliance Industries Ltd (RIL) picking up a 26 per cent stake in a Madhya Pradesh power project of Gautam Adani. "Mahan Energen Ltd, wholly owned subsidiary of Adani Power has entered into a 20-year long-term Power Purchase Agreement for 500 MW with RIL, under the Captive User policy as defined under the Electricity Rules, 2005," it stated.

Separately, Adani Power said its stake in Aviceda Infra Park Ltd has been transferred upon sale to AdaniConnex Private Ltd.

Technical analysts largely said that the stock looked 'bullish'. Support could be seen at Rs 560.

Osho Krishan, Senior Research Analyst - Technical & Derivatives at Angel One, said, "The stock has seen a strong resurgence recently, letting the counter inch toward its lifetime highs. It seems poised to enter uncharted territory and continue its northward journey. For now, Rs 560 is likely to provide a cushion for any blips, while on the higher end, an authoritative surge beyond Rs 600 could strongly thrust the bullish momentum in the comparable period."

AR Ramachandran from Tips2trades said, "The stock looked bullish on daily charts with strong support at Rs 560. A daily close above resistance of Rs 590 could lead to an upside target of Rs 639 in the near term."

Shiju Koothupalakkal, Technical Research Analyst at Prabhudas Lilladher, said, "The stock has been in a rangebound movement since the last four months with currently picking up momentum in the last three sessions. A decisive breach above Rs 590 will be very important to indicate a breakout and expect for fresh upward move for targets of Rs 625 and 670 levels."

Ravi Singh, Senior Vice-President (Retail Research) at Religare Broking, said, "The stock looked strong on daily charts. It can hit a near-term target of Rs 610. Keep stop loss placed at Rs 575."

The counter was trading 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 100. A level below 30 is defined as oversold while a value above 70 is considered overbought.

On BSE, around 5.45 lakh shares were seen changing hands today. The figure was lower than the two-week average volume of 10.30 lakh shares. Turnover on the counter came at Rs 31.90 crore, commanding a market capitalisation (m-cap) of Rs 2,26,923 crore.

Bourses BSE and NSE have put the securities of Adani Power under the long-term ASM (Additional Surveillance Measure) framework. Exchanges put stocks in short-term or long-term ASM frameworks to caution investors about high volatility in share prices.