Adani Power shares surge 12% to hit one-year high; can stock break above Rs 500?

Shares of Adani Power Ltd on Monday extended their gains for the second straight session. The stock soared 12.45 per cent to hit a 52-week high of Rs 495 in early trade. Although, the gains were halved as the session progressed as the scrip was last seen trading 4.84 per cent higher at Rs 461.50. At this price, the counter has gained 54.79 per cent on a year-to-date (YTD) basis and 77.88 per cent in the past six months.

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.

On technical setup, support on the counter could be seen at Rs 440. On the higher side, the stock may find resistance near Rs 500 level.

Jigar S Patel, Senior Manager - Technical Research Analyst at Anand Rathi Shares and Stock Brokers, said, "Near-term support is expected at Rs 440 and resistance is seen near Rs 500. Rs 440 would be ideal zone for entering longs."

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AR Ramachandran from Tips2trades said, "Adani Power looks overbought on daily charts with strong resistance at Rs 500. A daily close below support of Rs 440 could lead to target of Rs 397 in the near term."

DRS Finvest founder Ravi Singh suggested that the counter may see some resistance at Rs 500 level. Support will be around Rs 430, Singh added.

The counter was last seen trading higher than the 5-day, 10-, 20-, 30-, 50-, 100-, 150-, 200-day simple moving averages (SMAs). The counter's 14-day relative strength index (RSI) came at 74.50. A level below 30 is defined as oversold while a value above 70 is considered overbought. The company's stock has a price-to-equity (P/E) ratio of 9.14 against a price-to-book (P/B) value of 4.66.

As of September quarter, promoters held 70.02 per cent stake in the power firm.

All listed Adani Group stocks rose sharply today in sync with the domestic benchmarks. BSE Sensex and NSE Nifty hit fresh all-time highs today, driven by banks, financials and energy stocks as state election results boosted market momentum emerging from strong macroeconomic data and easing global interest rate expectations.

(Disclaimer: Business Today provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.)

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