Reliance Power , a prominent player in India's private power generation sector, has seen its shares tumble 15% over the past month, with the stock currently trading at Rs 56.72. The decline comes in the wake of Enforcement Directorate (ED) raids on premises linked to Anil Ambani, raising concerns among investors.

Stock Performance and Technical Analysis

The company's stock hit lower circuit limits for two consecutive sessions, contributing to the recent downturn. Despite the current slump, Reliance Power shares still maintain a 30% gain and a 47% increase over the past six months. Technical analysts have identified immediate support at Rs 54.00, with resistance levels near Rs 64.00-72.00.

ED Probe and Company Response

The stock's decline follows ED raids related to a Rs 3,000.00 crore Yes Bank loan probe. However, Reliance Power has moved swiftly to address investor concerns. In a media release, the company stated:

"The said actions have absolutely no impact on the business operations, financial performance, shareholders, employees, or any other stakeholders of Reliance Power."

The company clarified that the media reports appear to pertain to allegations concerning transactions of Reliance Communications Limited (RCOM) or Reliance Home Finance Limited (RHFL), which are over 10 years old. Reliance Power emphasized its status as a separate and independent listed entity with no business or financial linkage to RCOM or RHFL.

Financial Performance and Debt Reduction

Despite the recent stock price volatility, Reliance Power has shown improvements in its financial performance. The company reported a net profit of Rs 44.68 crore in its latest quarterly results, a significant turnaround from the Rs 97.85 crore loss in the same period last year.

In a move to strengthen its financial position, Reliance Power has reduced its debt by over Rs 5,300.00 crore. The company has also announced plans to raise Rs 9,000.00 crore through equity and debt instruments, signaling its commitment to financial stability and growth.

Management Changes and Future Outlook

The company's media release also noted that Mr. Anil D. Ambani is not on the Board of Reliance Power, further distancing the company from the ongoing probe. Reliance Power reiterated its focus on business plans and commitment to creating value for all stakeholders.

As the situation unfolds, investors and market watchers will be closely monitoring Reliance Power's performance and any further developments related to the ED investigation. The company's ability to maintain operational stability and continue its financial improvement will be crucial in regaining investor confidence in the coming months.

Reliance Power Limited (RPower) has issued a clarification regarding recent media reports about enforcement agency actions, emphasizing that these actions have no bearing on the company's operations or stakeholders. The power generation company, which operates independently from other Reliance Group entities, sought to distance itself from allegations involving Reliance Communications Limited (RCOM) and Reliance Home Finance Limited (RHFL).

Key Points of Clarification

• No Business or Financial Linkage: RPower stressed that it is a separate and independent listed entity with no business or financial connections to RCOM or RHFL.
• Historical Context: The allegations mentioned in media reports appear to concern transactions over a decade old, involving RCOM and RHFL, not RPower.
• Current Status of Related Entities: RCOM has been undergoing Corporate Insolvency Resolution Process for over 6 years, while RHFL has been fully resolved as per a Supreme Court judgment.
• Leadership Clarification: The company pointed out that Anil D. Ambani is not on Reliance Power's Board of Directors.

Business Focus and Operations

Reliance Power reaffirmed its commitment to its business plans and value creation for stakeholders. The company operates a substantial power generation portfolio:

The flagship project, Sasan Power Limited plant, is described as the world's largest integrated coal-based power plant.

Corporate Governance and Legal Matters

The company addressed the ongoing legal proceedings, noting that similar allegations to those in the media reports are currently sub-judice and pending before the Securities Appellate Tribunal.

Investor Relations

In its communication to the stock exchanges, RPower emphasized transparency and proactive disclosure. The company filed this clarification under Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, demonstrating its commitment to keeping investors and the market informed.

As the power sector continues to be a critical component of India's infrastructure growth, Reliance Power's clarification aims to reassure stakeholders of its operational independence and ongoing focus on its core business activities in the power generation sector.