Power Grid becomes top bidder for 2 projects in Chhattisgarh, shares head north

Shares of Power Grid Corporation of India gained over a percent on March 6 after the company announced it has been declared as the successful bidder under Tariff Based Competitive Bidding for two projects.

The purpose is to establish Inter-State Transmission System for the two projects on Build, Own Operate and Transfer (BOOT) basis.

At 9:33am, shares of the company traded 1.4 percent higher at Rs 225.10 on the BSE.

One of the projects will comprise setting up of 400 KV D/C Transmission Line passing through Chhattisgarh and Bays extension works at two existing sub-stations, while the other project encompasses Bays extension works, including the creation of 220KV Voltage at two existing sub-stations in Chhattisgarh, the company said in an exchange filing.

Catch up on all LIVE stock market updates here

Power Grid has been in the limelight lately given the influx of news and because of its recent order wins. Last week, the company was declared as the successful bidder under a Tariff Based Competitive Bidding for a project in Gujarat to establish Inter-State Transmission System.

In February-end, Power Grid’s board approved investing over Rs 803 crore for various electricity transmission projects in India, which could lead to higher revenue for the company.

The company was listed in 2007, and has three business segments – Transmission, Telecom and Consultancy, with transmission segment being the main focus of the business.

As the transmission industry is expected to continue growing, Power Grid is poised to capitalise on its strong pipeline of projects and continued capital expenditure in solar power generation and distribution infrastructure, said Geojit Research. However, in the near-term, the brokerage firm remains cautious on input price volatility and expects profitability to be impacted.

The stock has rallied from Rs 208 in early January to Rs 226. Several market participants have lately been bullish about power stocks with the demand rising in April and the government directing NTPC to run its plants at full capacity for a month, which has brightened the outlook for the power sector and made power stocks more attractive.