Reliance Power Limited (RPL) and Reliance Infrastructure (RInfra) have issued statements asserting that the recent Central Bureau of Investigation (CBI) chargesheet against Anil Ambani and others in a ₹2,796.00 crore bank fraud case will not affect their operations or financial performance. This announcement comes in response to the CBI filing charges alleging fraudulent transactions between Reliance Commercial Finance (RCFL), Reliance Home Finance (RHFL), Yes Bank, and firms connected to former Yes Bank CEO Rana Kapoor's family.

Key Points from the Companies' Statements

• No Impact on Operations: Both Reliance Power and Reliance Infrastructure emphasized that the CBI's actions will not influence their business operations, financial performance, shareholders, employees, or other stakeholders.

• Separate Entities: The companies stressed that they are separate and independent listed entities, and the CBI's actions have no bearing on their day-to-day management, governance, or financial stability.

• Resolution of Related Companies: Both RCFL and RHFL issues have been fully resolved through lender-driven processes led by Bank of Baroda under RBI regulations, following Supreme Court judgments in 2022 and 2023, respectively.

• Historical Context: The alleged transactions under CBI investigation are over 10 years old and pertain to RCFL and RHFL, not Reliance Power or Reliance Infrastructure.

Clarifications on Corporate Governance

The statements also provided clarity on corporate governance matters:

• Anil D. Ambani has never been on the boards of RCFL or RHFL since their inception, according to public records.
• Mr. Ambani stepped down from the boards of Reliance Power and Reliance Infrastructure over 3.5 years ago.

Companies' Focus

Despite the media attention surrounding the CBI actions, both Reliance Power and Reliance Infrastructure affirmed their commitment to their respective business plans and value creation for all stakeholders. The companies, which are part of the Reliance Group, continue to position themselves as leading players in their respective sectors.

Reliance Power's Current Position

The clear and prompt communication from Reliance Power and Reliance Infrastructure aims to reassure investors and stakeholders of their stability and independence from the ongoing investigations into related entities. Both companies' focus remains on their core businesses and maintaining their positions in their respective sectors.

Reliance Power (ISIN: INE614G01033) shares jumped 5% on Tuesday, reaching Rs 47.90, as part of a broader rally in Anil Ambani Group stocks. This uptick comes despite recent legal challenges and mixed technical indicators for the group's companies.

Market Performance

The recent surge in Reliance Power's stock price offers a glimmer of hope for investors after a challenging period. The company's shares have witnessed a significant 52.00% year-over-year gain. However, this positive long-term trend is tempered by a nearly 30.00% decline over the past three months, with the stock still trading well below its May peak.

Legal Challenges

The rally comes against a backdrop of legal issues facing the Anil Ambani Group. The Enforcement Directorate has filed a fresh money laundering case against Anil Ambani and Reliance Communications, alleging fraud of over Rs 2,900.00 crore against State Bank of India. Additionally, Bank of Baroda has classified Reliance Communications loans as fraudulent, adding to the group's regulatory challenges.

Financial Performance

Despite these headwinds, Reliance Power has shown signs of financial improvement. In the June quarter, the company returned to profitability, posting a profit of Rs 44.68 crore, a significant turnaround from the Rs 97.85 crore loss in the same period last year. However, it's worth noting that the company's revenues declined during this period.

Recent Contract Wins

Reliance Power has secured some notable contracts recently, which may have contributed to investor optimism. The company won a 500 MW battery storage project from Solar Energy Corporation of India (SECI), positioning itself in the growing energy storage sector.

Market Outlook

While the recent stock performance and return to profitability are positive signs for Reliance Power, investors should remain cautious. The legal challenges facing the Anil Ambani Group and the overall decline in revenue highlight ongoing risks. The stock's performance in the coming months may depend on how the company navigates these challenges and capitalizes on its recent contract wins.

As always, investors are advised to conduct thorough research and consider their risk tolerance before making investment decisions.