Reliance Power Ltd has successfully settled its entire debt of Rs 3,872 crore, marking a major shift in the company’s financial landscape.
On September 18, Reliance Power announced that it has cleared its obligations as a guarantor for Vidarbha Industries Power (VIPL). This means that Reliance Power has fully paid off the debt it was responsible for, totaling Rs 3,872 crore. As a result, the company has had all its corporate guarantees and related commitments released.
The settlement also resolves all legal disputes between Reliance Power and CFM Asset Reconstruction, the entity that held the debt. Both parties will now withdraw any ongoing legal actions against each other, including those related to the Insolvency and Bankruptcy Code.
The news had a notable impact on the stock market. Reliance Power’s shares hit the upper circuit limit, which means their price rose by the maximum allowed amount for the trading session. This indicates strong positive sentiment from investors about the company’s improved financial situation. On the day of the announcement, Reliance Power shares were trading at Rs 32.97, reflecting a five percent increase from the previous day.
With the debt fully settled, Reliance Power has announced that it now has no outstanding debt with banks or financial institutions. This is a major milestone for the company, signaling a fresh start. As of the end of the first quarter of the financial year 2025, the company’s consolidated net worth is reported to be Rs 11,155 crore.
This debt-free status provides Reliance Power with greater financial flexibility. The company can now focus on its core business operations and explore new growth opportunities without the burden of debt. This improved financial health is expected to attract new investments and enhance operational flexibility.
In a related development, the Securities and Exchange Board of India (SEBI) recently imposed a Rs 25 crore penalty on Anil Ambani. SEBI has also banned him from any association with the securities market for five years. This ban includes roles as a director or key managerial personnel (KMP) in listed companies or intermediaries registered with the regulator.
However, Reliance Power clarified that the SEBI order does not affect its business. The company was not involved in the proceedings against Ambani, and there are no specific directions from SEBI impacting Reliance Power’s operations.
Reliance Power’s successful debt settlement represents a crucial turning point for the company. With its debt now cleared, Reliance Power is well-positioned to leverage its improved financial status for future growth. Investors and analysts are keenly observing how the company will use this opportunity to strengthen its business and explore new avenues for expansion.
Reliance Power’s achievement of clearing a significant debt and its resulting debt-free status is a major milestone. The positive market reaction and resolution of legal issues suggest a promising future for the company.
