Nearly 3 weeks after Vedanta announced its delisting from Indian bourses, it is now Adani Power that is planning to delist from the bourses. The Board meeting to take a call on the same is scheduled on June 03 2020. Clearly, 3 factors are driving the intention of Adani Power to delist from the stock exchanges.

· Firstly, it is about low valuations for power stocks. Adani Power is in a sector which tends to get tepid valuations in the market. The reasons are not far to seek. Power has its problem with PPAs and coal supply flows. All this has led to depressed valuations of these stocks. Valuations from PE funds would be easier.

· Secondly, stocks are quoting at bargain prices like lower than book value. That makes the stock a bargain but the market is not willing to admit that argument. In such cases, it does make sense for the promoter group to delist the company and take it private.

· Limited use of listing if stock cannot be used as currency. Adani Power has capacity of 10,500 MW and is likely to increase to 12,500 MW shortly. But the market values Adani Power at just over Rs.1 crore per MW. This is unlike the case of NTPC which commands closer to Rs.2 crore per MW. Promoters now get full control over the cash flows of the business.