Shares of Adani Power tumbled 3 per cent on the BSE, after a ruling by Gujarat electricity regulator asked it to honour a supply agreement.
The scrip, which opened on a weak note, ended the day at Rs 133.20, down by 3.51 per cent, on the Bombay Stock Exchange.
During the day, the stock had fallen nearly 5 per cent to hit a month low of Rs 131.20.
On the National Stock Exchange the stock closed at Rs 133.60, down 3.33 per cent.
Broader market was flat, with the BSE benchmark Sensex ending the day at 18,238.31, up 32.44 points.
Stocks fell after a ruling by Gujarat Electricity Regulatory Commission asked Adani Power to honour an agreement with Gujarat Urja Vikas Nigam in 2007 to supply 1,000 megawatt (MW) power at Rs 2.35 per unit for 25 years.
In its order, the regulator has ruled that arranging fuel supply is the responsibility of Adani and the power purchase agreement cannot be terminated on the basis of failure to execute a formal fuel supply agreement.
The company had terminated the accord in January as it couldn't conclude a deal to secure coal for the proposed power plant in Mundra in the western state, the regulator said.
However, brokerages do not see any negative impact on Adani post this oder.
"In our earnings and valuation estimates, we have always assumed that APL would honour the PPA and supply 1,000MW to GUVNL at a tariff of Rs 2.3495/unit, for a period of 25 years starting February 2012.
"Hence, with the GERC ruling, there is no impact on our earnings and fair value estimates, and hence, they remain unchanged," IDFC said in a note.
