Reliance Power Shares Drop 4% Ahead of Crucial Board Meeting

Shares of Reliance Power took a hit on Monday, dropping by 4.33% to a low of Rs 44.35 on the Bombay Stock Exchange (BSE). This decline comes just days before a key board meeting scheduled for Thursday, October 3, where the company will discuss plans to raise long-term funds by issuing equity shares and other related instruments.

Over the past two weeks, Reliance Power shares had surged by 44%, making the recent drop notable. The Anil Ambani-led firm plans to consider several methods for raising capital, including domestic and global market options. The agenda for the meeting also includes discussions about equity-linked securities, convertible warrants, a preferential issue, or even a qualified institutional placement (QIP). The board may also explore a rights issue or the issuance of foreign currency convertible bonds (FCCBs). These fundraising efforts will help the company expand its renewable energy portfolio and meet its long-term working capital needs.

Recently, Reliance Power made headlines after allotting 46.20 crore equity shares worth Rs 1,524.60 crore to Reliance Infrastructure Ltd and two non-promoter entities, Authum Investment and Infrastructure Ltd and Sanatan Financial Advisory Services Private Ltd, as part of its efforts to boost its renewable energy investments.

The company aims to allocate Rs 803.60 crore from the proceeds towards expanding its renewable energy footprint and exploring other business opportunities. Reliance Power also revealed that it has cleared all its debts from banks and financial institutions and now boasts a consolidated net worth of Rs 11,155 crore as of June 30. This was made possible after the settlement of disputes with CFM Asset Reconstruction Private Limited, leading to the release of corporate guarantees tied to its subsidiary VIPL.