Adani Power Shares Surge 4%
Shares of Adani Group company Adani Power surged 4.2% in early trade today, reaching a day’s high of Rs 511.85 on the BSE, after Bangladesh asked the firm to fully resume supplies from its 1,600-megawatt plant in India. This comes after more than three months of reduced sales, during which supplies were halved due to low winter demand and payment disputes, according to a Bangladesh official. The state-run Bangladesh Power Development Board (BPDB) stated that it had been paying $85 million per month to Adani to settle outstanding dues and has now requested the company to resume supply from the second unit. The Indian company reduced its supply to Bangladesh by half on October 31 due to payment delays caused by the country's foreign exchange shortage. As a result, one unit was shut down on November 1, bringing the plant's operational capacity down to approximately 42%.Adani, which entered into a 25-year contract under former Prime Minister Sheikh Hasina in 2017, has been supplying power from its $2 billion plant in Jharkhand, India. The plant consists of two units, each with a capacity of 800 megawatts, and sells electricity exclusively to Bangladesh.In December, an Adani source revealed that BPDB owed the company about $900 million, while Karim stated the amount was only about $650 million at the time. The pricing dispute centers around how power tariffs are calculated. The 2017 agreement sets prices based on an average of two indexes. Adani’s power costs Bangladesh about 55% more than the average price of all Indian power sold to Dhaka, according to Reuters. A Bangladesh court has ordered an examination of the contract with Adani by a committee of experts, with results expected this month. This could potentially lead to contract renegotiations.
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Bangladesh Seeks Full Power Supply Restoration From Adani Plant
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