Shares of penny stock Jaiprakash Power Ventures have been on an upward trend, rising nearly 30 percent just in August so far. Of the 7 sessions in August, the stock has given positive returns in 6 of them.
It has also advanced over 33 percent in 2022 YTD and nearly 70 percent in the last 1 year.
Despite the stellar return, it is important to note that penny stocks are high-risk stocks and not suitable for investors with a risk-averse approach. Only high-risk investors should invest in such stocks and in very small weightage. Please consult your financial advisor before making any changes to your portfolio.
The company is engaged in the business of generation of Thermal and Hydro Power, cement grinding, and Captive Coal Mining. Its subsidiary includes Jaypee Powergrid Limited, Jaypee Arunachal Power Limited, Sangam Power Generation Company Limited, Jaypee Meghalaya Power Limited and Bina Power Supply Limited.
The recent surge in the stock comes on the back of spectacular June quarter earnings. consolidated net profit jumped multi-fold to ₹241.96 crore in Q1FY23 on the back of strong revenues. It had reported a consolidated net profit of ₹4.34 crore in the same quarter last year.
Its total revenue also jumped over 97 percent YoY to ₹1,829.35 crore during the quarter under review from ₹926.41 crore in the same period year ago.
Power stocks have been performing well recently due to the massive heatwave in North India leading to high consumption of power.
Other power stocks have also performed tremendously. Adani Power has rallied 263 percent in the last 1 year and 237 percent in 2022 YTD. Tata Power has also risen 72 percent in the last 1 year and gained 3 percent in 2022 so far. Meanwhile, JSW Energy has gained 26 percent in the last 1 year while Torrent Power has added 20 percent in this time.
Power stocks have also been in focus on the back of the Electricity Amendment Bill which was introduced in the parliament on Monday. The bill aims to transform the power distribution sector, which is the weakest link in the power chain, by enabling competition, strengthening payment security and giving regulatory commissions more power.
The Union Cabinet approved the Bill last Wednesday. It allows other distribution licensees to use their network for retail distribution of electricity.
“The amendments to the Act are also necessary for a view of the importance of green energy for our environment in the context of global climate change concerns and our international commitments to increase the share of renewable energy,” said, the government.
Disclaimer: This story is for educational purposes only. Please speak to an investment advisor before making any investment decisions.