Why is Reliance Power falling/rising?

Sep 12 2025 09:28 PM IST
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As of 12-Sep, Reliance Power Ltd is priced at 45.81, down 1.36%. Despite strong long-term returns, recent performance is weak due to bearish trends and financial challenges, including declining operating profits and low mutual fund confidence.
As of 12-Sep, Reliance Power Ltd is currently priced at 45.81, reflecting a decrease of 0.63, or 1.36%. The stock has been underperforming, having fallen for the last two days with a total decline of 2.01%. It is trading below its 5-day, 20-day, 50-day, 100-day, and 200-day moving averages, indicating a bearish trend. Despite a strong year-to-date return of 7.64% and a remarkable 54.40% return over the past year, the stock's recent performance has been negatively impacted by a weak long-term fundamental strength, evidenced by a -10.04% CAGR growth in operating profits over the last five years and a high Debt to EBITDA ratio of 9.63 times. Additionally, the low stake of domestic mutual funds at only 0.94% suggests a lack of confidence in the stock's valuation.

In the broader market context, the stock has underperformed compared to the benchmark Sensex, which has gained 1.48% over the past week while Reliance Power has declined by 2.37%. This short-term underperformance contrasts with its strong long-term returns, as the stock has significantly outperformed the market over the past year, generating a return of 54.40% against the Sensex's decline of 1.28%. The recent rise in investor participation, with a notable increase in delivery volume, may indicate some underlying interest, but the overall sentiment remains cautious due to the company's financial challenges and the recent price decline.
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