HG Infra Engineering shares jump over 8% after receiving LoI from REC
HG Infra Engineering shares rose after the company received a letter of intent from REC Power Development and Consultancy for constructing two 220/132/33 kV AIS substations and associated transmission lines in Uttar Pradesh.
Infrastructure development firm HG Infra Engineering experienced an 8% surge in its shares, reaching Rs 551.95 on the BSE, following REC Power Development and Consultancy Ltd's letter of intent. The letter, announced in a regulatory filing on Tuesday, pertains to the construction of two substations and their associated lines in Uttar Pradesh.
The substations, with tariffs, were procured through a competitive bidding process, with REC Power Development and Consultancy Ltd recognizing HG Infra Engineering as a qualified bidder. In May, the company revealed its qualification to build, own, operate, and transfer the substations under a 18-month contract for transmission charges of Rs 45 crore annually.
Despite this positive news, the company's Q1 results showed a 77.5% year-on-year decline in profit after tax to Rs 28.3 crore, with revenue from operations dropping 46.9% to Rs 907.2 crore. Despite the recent share price appreciation, HG Infra Engineering's shares have declined over 9% year-to-date, but have delivered over 18% returns in the long term over the past three and five years.
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