Adani Enterprise Ltd moved to Rs.201.90 before closing at Rs.198.60, up 2.08%. The fact that the scrip closed near the day's high is good for the shareholders. I am expecting the scrip to cross Rs.210, within a couple of days.
Reliance Power Ltd today moved to Rs.104.95, and then closed at Rs.104.35. Similarly, KSK Energy Ventures Ltd closed at Rs.61.25, near the day's high.
Meanwhile, Planning Commission deputy chairman, Montek Singh Ahluwalia believes that the outstanding debt of power distribution companies (discoms) needs to be restructured. He said, "Half of the outstanding SEB debt will be taken over by the state government and half wil be helf by bank guarantee by state government". The Centre and States will not be able to achieve high growth and promote financial inclusion without addressing the problem of mounting losses of the power sector which are estimated at Rs.70, 000 Cr per annum, the Planning Commission said. The Commission had invited the state power ministers to discus to deal with various issues of energy sector. Moreover, a decade after the Center stepped in to rescue debt-stressed electricty distribution companies, the power ministry has prepared another bail out package for these entities whose combined debt has reached an unmanageable Rs.2 lakhk crore. While these discoms, hamstrung by up to a 40% gap between cost nd revenue, have already defaulted in payments to power generators, they are facing teh specter of defaulting on loan repayments to too. "A Cabinet note (on discoms' debt restructuring) has ben prepared. We are taking views of the ministries and departments concerned---the finance ministry and the Planning Commission---on this, "Union Power Secretary, P Uma SHankar said. Also, there were reports in the media that, Union Power Ministewr Sushil Kumar Shinde, close on the heels of hike in power tariffs in many states advocated rising electricity tariff in small dozes every six months to spare consumers of one-time sharp hikes. Shinde, said, hike in electricity bill was inevitable due to rise in cost of fuel used for generating power. "We have to increse the tariff..Fuel prices have increased....I feel every six months there should be a rise in power tariffs, so that the common man does not fee the heat when they are revised after a gap of seven years", Shinde said. Another positive news for the power sector is that Adani Power and Tata Power Co Ltd have approached the Central Electricity Regularatory Commission, India's top power sector regulator, to consider, an increase in power tariffs. "Adani Power and Tata Power have filled their petitions. The hearing is on 19th Jul, " sid Pramod Deo, Chairman, CERC. Tata Power, has sought regulatory interventions. The petitions seeking an increase in tariff for imported coal based power project were filed after customers for the electricity generated from these two projects both located in Mundra in Gujarat, declined to pay high rates. Therefore, with so much developments going on here, I think this is the best time to enter the sector.