MUMBAI, Feb 24: Shares of power producers Tata Power and Adani Power surged in morning trade on the bourses after the electricity regulator CERC allowed them higher tariff and total compensation for their Mundra power projects.
On Saturday, CERC allowed Tata Power and Adani Power, higher tariff and total compensation worth over Rs 1,100 crore for their Mundra power projects fired by imported coal.
Reacting to the development, shares of Tata Power opened on a bullish note at Rs 83 on the BSE and gained further ground and surged as much as 7.36 per cent to Rs 84.50 a share.
Similar movement was witnessed on the Adani Power counter where the stock after opening at Rs 38.20, surged 5.21 per cent to an early high of Rs 38.35.
Market analysts attributed the surge on power stocks as a knee jerk reaction to the Saturday’s development.
The much awaited rulings would help mitigate the losses suffered by the two Mundra projects, located in Gujarat, due to price rise in Indonesian coal that is used to fire these plants.
Tata Power is running the 4,000 MW Mundra Ultra Mega Power Project (UMPP), while Adani Power is implementing the 4,620 MW Mundra plant.
Describing the order as “balanced”, Tata Power had said in a statement that it provides partial relief to Mundra UMPP.
In a separate order running into 133 pages, CERC granted nearly Rs 830 crore compensation for Adani Power’s 4,620 MW Mundra plant. (AGENCIES)
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