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Reliance Power's share was on fire last week, jumping 16 per cent in a single day. But today (May 26, 2025), it simmered down a bit. After hitting a 52-week high (Rs 55) earlier today, the share price fell nearly 1.7 per cent to Rs 51.
Let's unpack what's going on.
Q$ FY25 performance summary
| Metric | Q4 FY25 | Q4 FY24 | YoY change |
|---|---|---|---|
| Revenue | Rs 1,937 crore | Rs 2,008 crore | - 3.5 per cent |
| Net profit | Rs 126 crore | - Rs 397 crore | 132 per cent |
| EBITDA | Rs 599 crore | Rs 288 crore | 108 per cent |
| EBITDA margin | 30.9 per cent | 14.3 per cent | 1,660 bps |
So, why was the stock flying last week?
-
Back to profit:
Reliance Power surprised everyone by posting a Rs 126 crore profit in Q4 FY25. That's a big turnaround from a Rs397 crore loss last year. For a company many had written off, this is no small feat.
- A solar splash: The company also announced a solar joint venture worth Rs 2,000 crore with Bhutan's Druk Holding. The project? A 500 MW solar plant - the biggest private sector renewable investment in Bhutan to date. It's signed a 25-year deal to sell power, which means steady future cash flows if all goes to plan.
What's behind today's dip?
Most likely profit booking. After a 16 per cent surge, a 1-2 per cent cool-off isn't surprising. Unless fresh news hits, the stock may take a breather before moving up again.
However, valuation remains a concern. Reliance Power's P/E ratio is around 328. That's steep, especially for a company still clawing its way back.
About Reliance Power
Reliance Power is part of the Anil Ambani group and runs several power projects, mostly thermal, but it's dipping its toes deeper into renewables now.
Here is how its fundamentals look.
| Metric | Value |
|---|---|
| Market cap | Rs 21,254 crore |
| ROE | -19.4 per cent |
| ROCE | 1.3 per cent |
| P/E ratio | 7.2 |
| P/B ratio | 1.3 |
| Book value | Rs 40.5 |
| EPS | -Rs 0.4 |
How is Reliance Power rated by Value Research?
-
Overall:
2/5
-
Quality:
1/10
-
Growth:
5/10
-
Valuation:
2/10
- Momentum: 9/10
The bottom line
Reliance Power has everyone's attention again. It's making money, going green and gaining momentum. But before you jump in, remember, this is still a turnaround story.
If you're already in, stay alert. If you're watching from the sidelines, you might get a better entry once the dust settles.
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Disclaimer: This is not a stock recommendation. This story was created with the assistance of artificial intelligence and is intended for informational purposes only. Please take it with a pinch of salt and do your own research or consult a financial advisor before making investment decisions.
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