Anil Ambani’s Reliance Power Shares Surge Ahead of Q4 Results, Deliver 40% Returns in One Month

Anil Ambani’s Reliance Power share price has witnessed a sharp rally of nearly 40% over the past month, surprising many investors despite the company’s weak fundamentals and ongoing legal challenges linked to the Anil Ambani group. This sudden surge has raised a key question in the market—what is fueling the rally, and more importantly, is it sustainable?

From a valuation standpoint, the stock appears inexpensive, with its price-to-book (P/B) ratio trading below 1. This indicates that the stock is available at a discount to its book value. However, a closer look at the fundamentals paints a different picture. The company is burdened with a high debt of around ₹15,200 crore, while its return on equity (ROE) remains negative. This suggests that instead of generating returns for shareholders, the company is currently incurring losses. Additionally, growth has largely remained stagnant, making the recent rally seem more sentiment-driven rather than backed by strong business performance.

Reliance Power has long been stuck in a low-price band, and such stocks often display high beta characteristics. Even small buying interest can lead to sharp percentage gains. The recent jump from levels around ₹20–21 to ₹28–29 reflects this nature, where retail participation and trader activity amplify the upward momentum.

Another factor supporting the rally is the renewed market interest in the power and renewable energy sectors. Government-led capital expenditure and rising electricity demand have attracted investors toward this theme. As a result, even underperforming and smaller players like Reliance Power have benefited from the broader sectoral optimism.

In addition, company-specific developments have contributed to positive sentiment. Reliance Power’s move to raise over ₹600 crore through a warrant issue, along with progress in battery energy storage systems (BESS) and solar projects, has strengthened the turnaround narrative. News of a potential 500 MW project in Bhutan has further added to investor excitement.

A significant portion of the rally is also attributed to short covering and momentum-driven trading. As the stock started gaining, traders with short positions rushed to cover, further accelerating the upward movement. This indicates that technical factors have played a major role in the rally, rather than purely fundamental strength.

However, risks remain firmly in place. The company’s high debt, weak profitability metrics, and past instances of defaults continue to be major concerns. This is why the current rally appears to be largely driven by sentiment and trading activity, rather than a solid improvement in core business fundamentals.On whether this rally in Reliance Power shares ahead of the Q4 results 2026, Abhinav Tiwari of Bonanza said, "From an investment perspective, the fundamentals do show signs of restructuring and a genuine turnaround in progress." However, without confirmation through consistent earnings, cash flow visibility, or a clear business trigger, entering at current levels carries risk. It is more prudent to wait for confirmation, either through Q4 results or tangible developments, before taking a strong view.

“Reliance Power today sits in a transition phase. The downside risks from the past have reduced, but the upside story is still evolving. This places the stock in a high-risk turnaround category, where confirmation is more important than chasing momentum,” said Abhinav Tiwari.According to the shareholding pattern of the ADAG group company for the March 2026 quarter, Anil Ambani owns 4,65,792 shares, or a 0.01% stake, as a promoter. His wife, Tina Ambani, and son, Anmol Ambani, hold 0.01% stakes in the company, whereas his mother, Kokila D Ambani, holds a 0.02% stake. These family members also hold company shares as promoters.