Monday morning, after Adani Power bought its group company DB Power, shares of DB Corp went up more than 17% to a new 52-week high.
Adani Power, which is led by Gautam Adani, has agreed to buy the thermal power assets of DB Power (DBPL) from Dainik Bhaskar Group for about Rs 7,017 crore. DB Corp is the largest company in the Dainik Bhaskar Group.
After the news, shares of DB Corp went up by more than 17%, reaching a new 52-week high of Rs. 112.05 before settling at Rs. 109.80 at 9:50 a.m. The price of the stock at the end of trading on Friday was Rs 95.45.
Both parties signed a contract for the cash-only deal on Friday afternoon. The MOU will be in effect from now until the acquisition is finished on October 31, 2022, but if both parties agree, it can be extended.
DB Power has 2 thermal power plants in the Chattisgarh district of Janjgir-Champa. Each of these plants has a capacity of 600 MW. A different holding company runs the part of Dainik Bhaskar that deals with power.
Its parent company, Diliigent Power (DBPL), owns 83.87 percent of the business. A private equity firm called Global Infrastructure Partners (GIP) owns 16.13% of the company.
For FY 2021–2022, the company made Rs 3,488 crore in sales. It made Rs 312 billion in profit for FY21. It owes about Rs 5,500 crore in debt. At this price, the deal is one of the biggest in the sector in recent years. It is worth Rs 6 crore/MW.
At Rs 428, Adani Power went up by about 4% and hit a new 52-week high. On Friday, the stock was worth Rs 412.20. At 9:55 a.m. on Monday, it was worth Rs 424.80.
The market value of Adani Power is close to Rs 1.65 lakh crore. In the past year, the price of its shares has gone up by about 480 percent. It is the 33rd largest publicly traded company in India. It is bigger than power giants like Power Grid, Coal India, and NTPC.