Reliance Power, a key player in Anil Ambani’s ADAG group, has seen its share price soar by 20% in just one month, climbing from ₹34.65 to ₹40 as of April 13, 2025. This impressive rally has caught the attention of investors, but with market volatility on the rise, many are left wondering: Should you buy, sell, or hold Reliance Power shares? Let’s break down the details, explore expert insights, and provide guidance for making informed investment decisions.
Reliance Power Shares Surge 20% in Just One Month
According to a report by *Livemint* on April 13, 2025, Reliance Power shares have delivered alpha returns, outperforming major indices like the Nifty 50 (up 1.60%), BSE Sensex (up 1.52%), and Nifty Bank Index (up 6.13%) over the past month. The stock’s 20% surge comes despite broader market volatility driven by global economic concerns, including Donald Trump’s tariff tensions. This rally has sparked renewed interest in the Anil Ambani-led company, which has historically faced challenges but is now showing signs of recovery.
The Stock Is Part of Anil Ambani’s ADAG Group
Reliance Power is a flagship company under the Anil Dhirubhai Ambani Group (ADAG), a conglomerate founded after the 2006 split of Reliance Industries. As of January 16, 2024, Reliance Power was the largest company in the ADAG portfolio, with a market capitalization of ₹11,674 crore. The group, led by Anil Ambani, operates across sectors like telecommunications, financial services, infrastructure, and power generation. However, Reliance Power has faced significant hurdles in the past, including heavy debt, regulatory issues, and coal supply problems, which have impacted its financial health.
Investors Are Now Wondering Whether to Buy, Sell, or Hold
The recent 20% surge has left investors at a crossroads. Should you jump in and buy more shares, cash out and secure profits, or hold onto your position? The answer depends on several factors, including your risk appetite, investment goals, and the stock’s fundamentals. While the rally signals positive momentum, the broader market context which is marked by tariff tensions and global uncertainty, adds a layer of complexity.
Analysts Suggest Caution Due to Market Volatility
Stock market experts are urging caution amid the current volatility. The Indian market has been under pressure due to Donald Trump’s tariff policies, which have impacted investor sentiment globally. Reliance Power’s past struggles with debt and governance issues also raise red flags. Analysts recommend a thorough evaluation of the company’s fundamentals before making any decisions. For instance, the company’s ambitious expansion plans in the past led to massive debt, and delays in power plant projects have hurt its profitability.
However, some analysts see potential in Reliance Power’s recent performance. The stock’s outperformance compared to broader indices suggests renewed investor confidence, possibly driven by improved operational efficiency or new project developments. Investors should watch for updates on the company’s debt restructuring efforts and future power projects, which could further influence its stock trajectory.
Always Check Fundamentals and Expert Advice Before Investing
Before deciding to buy, sell, or hold Reliance Power shares, here are some key steps to follow:
1. Analyze Fundamentals:
Look at Reliance Power’s financial health, including its debt levels, revenue growth, and profit margins. The company’s history of heavy borrowing warrants careful scrutiny
2. Monitor Market Trends:
With global tariff tensions affecting markets, keep an eye on broader economic indicators and their impact on the power sector.
3. Seek Expert Advice:
Consult financial advisors or use tools like Alpha Spread to assess whether Reliance Power is overvalued or undervalued. For context, Reliance Industries Ltd (a related entity) was deemed undervalued by 7% at ₹1,153.60 against an intrinsic value of ₹1,244.28.
4. Diversify Your Portfolio:
Avoid overexposure to a single stock, especially in a volatile sector like power generation, which is sensitive to regulatory changes and fuel costs.
Final Note
Reliance Power’s 20% surge in a month is an encouraging sign for investors, but the stock’s history and current market volatility call for a cautious approach. While the company, part of Anil Ambani’s ADAG group, shows signs of recovery, its past challenges with debt and governance cannot be overlooked. Investors should carefully analyze the stock’s fundamentals, stay updated on market trends, and seek expert advice before deciding to buy, sell, or hold. In a volatile market, informed decision-making is key to maximizing returns and minimizing risks.
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