adani power:  Adani Power scrip hits circuit as Rajasthan discoms pay Rs 3,000 crore - Times of India

adani power: Adani Power scrip hits circuit as Rajasthan discoms pay Rs 3,000 crore – Times of India

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NEW DELHI: Adani Power shares on Tuesday shot up to a 52-week high, hitting the 10% upper circuit on reports the company has received Rs 3,000 crore in past dues from three Rajasthan discoms (distribution companies).
The scrip was also propelled by the news of 32 lakh shares, or 0.2% of the equity, exchanged hands in a block deal. The buyer remained unidentified.
The company received the payment under a March 25 Supreme Court order asking Rajasthan Urja Vikas Nigam, Jaipur Vidyut Vitran Nigam and Jodhpur Vidyut Nigam to pay past dues with interest within four weeks or face the prospect of the discom brass to personally appear in court to explain.
At the hearing on March 31, the discoms informed the court that they have paid Rs 3,000 crore to the company on March 30 as per its order.
Adani Power had signed an agreement with the Rajasthan discoms in March 2008 to set up a 1,200 MW coal-based power project in the state’s Kawai area at a cost of Rs 6,000 crore.
According to the agreement, Adani Power was to set up the plant and Rajasthan had to facilitate coal supply from the Central government or other sources. As the state government could not arrange coal, Adani Power used imported coal to fulfil its supply commitment.
Since imported coal is costlier than domestic coal, Adani Power claimed a higher tariff as higher fuel costs are allowed to be passed on to consumers. The state tariff regulator in 2018 allowed compensatory tariff to Adani Power.
The discoms challenged this at the Appellate Tribunal for Electricity, which upheld the state regulator’s order. The matter ultimately moved to the Supreme Court, which settled the case in favour of the supplier.



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