Reliance Power share price climbs 5% to hit upper circuit for 2nd day in a row; here's why

The stock was trading at 43.14 apiece, up 5%, its upper circuit limit, on the National Stock Exchange (NSE). On the BSE, it was up 5% to 43.12 per share.

SECI issued a show cause notice to Reliance Power on November 13, asking why criminal proceedings should not be brought against the company after its unit submitted a fake bank guarantee.

On Tuesday, SECI stated that withdrawing the debarment notice is without prejudice to its right to take all actions per the law.

SECI said that following the legal proceedings, the debarment notice given to Reliance Power Limited has been withdrawn with immediate effect.

In an exchange filing, Reliance Power said that with withdrawal of debarment notice by SECI, "the company and its subsidiaries, except Reliance NU BESS Ltd (formerly known as Maharashtra Energy Generation Limited), are eligible to participate in all tenders issued by SECI".

Reliance Power Q2 results

The Anil Ambani-led company reported a consolidated profit after tax (PAT) of ₹2,878.15 crore in the latest September quarter. A year ago, it reported a net loss of ₹237.76 crore.

Total income declined 7.25% to ₹1,962.77 crore in Q2 FY25, compared to ₹2,116.37 crore in the corresponding period last fiscal year.

The firm gained ₹3,230.42 following the deconsolidation of a subsidiary, Reliance Power said. A subsidiary's deconsolidation takes place when the assets, equities or liabilities associated with it are not reflected in the financial position of the parent company.

In the second quarter of FY25, the company settled ₹3,872 crore guarantor obligations of its subsidiary Vidarbha Industries Power Ltd (VIPL). Hence, VIPL

"The entire obligations of the Parent Company (Reliance Power) as a guarantor on behalf of VIPL stands fully settled, resulting in the release and discharge of corporate guarantee, undertakings, and all obligations and claims thereunder in relation to the outstanding debt of VIPL amounting to ₹3,87,204 lakh," the exchange filing said.

Hence, VIPL ceased to be a subsidiary of Reliance Power effective September 17, it added.