Adani Power and Tata Power are shedding points following the Supreme Court setting aside Appellate Tribunal for Electricity order of compensatory tariff to these companies.
In April 2016, the Appellate Tribunal for Electricity (APTEL) had said that Tata Power and Adani Power needed to be compensated as th change in Indonesian laws on coal export prices were outside the control of these companies.
The APTEL had held then that the change in Indonesian laws in 2011 that made the companies’ Mundra plants unviable to be a case of force majeure and that the losses incurred by the companies due to the change in Indonesian laws which made coal imports from the country costly, was outside their control and the companies must therefore be compensated. It asked the Central Electricity Regulatory Commission to work out a compensation package within three months.
Now, with the apex court setting aside the Tribunal's order, shares of Tata Power and Adani Power are deep down in negative territory. Following the apex court's order, the ratings of Adani Power and Tata Power stocks are likely to see significant downgrades.
Tata Power tanked to Rs 81.15 and is currently at Rs 84, down 3.5% from its previous closing price. On the National Stock Exchange, the Tata Power counter has clocked a volume of nearly 23.36 million shares so far in the session. On BSE, 2.3 million shares have changed hands so far at the Tata Power counter today.
Meanwhile, Adani Power, which declined to Rs 35.40, is at Rs 37.10, netting a loss of 16.2%. The Adani Power counter on the National Stock Exchange has recorded a volume of around 85.7 million shares so far in the session. On BSE, more than 11.3 million shares have changed hands so far at the Adani Power counter today, nearly 9 times the average daily volume the counter witnessed in the past couple of weeks.
