Jaiprakash Power Ventures (JP Power) shares fell by 2% after the bankrupt infrastructure group witnessed a sharp rally amid buzz of takeover by Gautam Adani Group. Today the shares are trading at 19.23 witnessing a two percent drop against the previous close of 19.65. The stock has gained more than 27 percent in two days. The rally followed reports on Nov. 19 that creditors selected Adani’s takeover proposal for JAL over a higher bid submitted by Vedanta.
Market watchers indicated the correction was expected, given that the stock has a history of sharp rallies followed by equally sharp pullbacks. Analysts also pointed out that the fundamentals of the business have not changed in the past few days. Jaiprakash Power continues to face structural challenges, including high debt, pressure on its power generation margins and the need for sustained improvement in cash flows. Technical factors also played a role in today’s decline. After a rapid upward move, the stock entered overbought territory, raising the risk of a short-term reversal. With many short-term traders active in the counter, even moderate selling can trigger a larger drop.
According to reports, lenders favored Adani’s offer because it included larger upfront payments. Vedanta’s ₹17,000 crore bid exceeded Adani’s ₹13,500 crore proposal, but its payment structure extended across five years. Adani offered a shorter timeline of one and a half to two years, which creditors viewed as a more practical recovery plan. The lenders include several major Indian banks. JAL, currently undergoing insolvency proceedings, drew interest from multiple bidders. Apart from Adani and Vedanta, companies such as Dalmia Bharat, Jindal Power, and PNC Infratech also submitted offers. Controlling shareholder Manoj Gaur lodged a last-minute proposal but withdrew it. Jaiprakash Associates, once a major infrastructure and cement conglomerate, entered insolvency due to growing debt and sustained financial stress. The company’s assets, including real estate, power, and cement interests, attracted bidders as part of the resolution process under India’s Insolvency and Bankruptcy Code.