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Reliance ADAG group stocks in focus: Shares of the Anil Dhirubhai Ambani Group (ADAG), which include Reliance Home Finance, Reliance Infrastructure, and Reliance Power, saw a significant increase during trading on Friday (May 23). The stocks of Anil Ambani's Reliance ADAG group experienced a surge, fueled by a number of positive announcements, enhanced financial stability, and important new business initiatives.

Reliance Home Finance shares saw a rise of 10% to ₹3.64 each, Reliance Power stock increased by 19% to ₹53, and Reliance Infrastructure's share price rose by 10.5% to ₹313 per share.

Gaurav Goel, the Founder & Director at Fynocrat Technologies, notes that the current stock surge is primarily driven by two major companies from the Anil Ambani-led Reliance ADAG group: Reliance Power, a notable private-sector electricity producer that is also making strides in solar and renewable energy with various large-scale projects.

The second company, Reliance Infrastructure, focuses on power distribution and EPC contracts while becoming increasingly involved in defense manufacturing through its subsidiary, Reliance Defence.

Although both firms faced challenges in the past due to significant debt and poor performance, a number of crucial agreements and improved financial outcomes are altering investor sentiment towards these companies.

Reliance Power is repositioning itself as a major renewable energy player. Recent project wins include:

- SECI PPA : Subsidiary Reliance NU Suntech signed a 25-year agreement with SECI to supply 930 MW of solar power with 1,860 MWh of battery storage. This ₹10,000 crore project is set to become Asia’s largest integrated solar plus storage plant.

- SJVN Win : Reliance NU Energies won a national tender for a 350 MW solar + 700 MWh BESS project floated by SJVN, further strengthening the group’s clean energy footprint.

- Bhutan Project : Reliance Power also signed a commercial term sheet with Bhutan’s government to develop a 500 MW solar plant in a ₹2,000 crore joint venture which is the largest private-sector foreign investment in Bhutan’s renewable space to date.

Reliance Power recently reported a turnaround , posting a net profit of ₹126 crore for the March quarter, compared to a loss of ₹397 crore in the same period last year. The cost controls and lower finance expenses are being seen as a sign of operational discipline.

In May, Reliance Power raised ₹392 crore through the conversion of preferential warrants by Reliance Infrastructure and Basera Home Finance. This capital boost helps strengthen the balance sheet and improve financial flexibility.

Reliance Infrastructure’s defence arm, Reliance Defence Ltd, announced a strategic collaboration with Rheinmetall AG, a major German defence company. After two successful joint ventures with global majors, Dassault Aviation and Thales Group of France, this is the third significant international partnership for Reliance Defence.A non-binding agreement has been signed to jointly manufacture ammunition and propellants in India.

A large-scale Greenfield manufacturing facility will be built in Ratnagiri, Maharashtra, under the Dhirubhai Ambani Defence City. The goal is to position Reliance Defence among the top three defence exporters in India. The manufacturing facility, one of the largest in South Asia, will have an annual capacity to produce up to 200,000 artillery shells, 10,000 tons of explosives and 2,000 tons of propellants.

Reliance Infrastructure also announced a settlement of a ₹1,673 crore corporate guarantee with Cosmea Business Acquisitions Pvt Ltd. The agreement gives the company 10 years of flexibility, with no immediate cash obligations.

On a less positive note, HK Toll Road, a subsidiary of Reliance Infrastructure, is involved in a legal matter where Canara Bank has filed a case for a claim of ₹282.60 crore under the Insolvency and Bankruptcy Code. The company has assured that it will take the necessary legal steps to protect its interests.

According to Anshul Jain, Head of Research at Lakshmishree Investments, the ADAG pack, Reliance Power stands out as the strongest, having broken out of a 33-week-long cup and handle pattern on the weekly chart. The breakout was backed by volumes 8x higher than the 50-day average, indicating strong, broad-based participation.

“The stock is currently holding above the breakout level, and any dip towards ₹48 or consolidation around this zone presents a fresh buying opportunity. The pattern projects an immediate upside target of ₹65,” said Jain.

Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision.

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