Reliance Infrastructure jumped 5.25% to Rs 1284.90 at 15:15 IST on reports the firm may sell shares in its power distribution and metro project units to the public and strategic partners to unlock value.
Meanwhile, the BSE Sensex was up 99.15 points, or 0.59%, to 16955.60.
On BSE, 8.85 shares were traded in the counter as against an average daily volume of 8.18 lakh shares in the past one quarter.
The stock hit a high of Rs 1293 and a low of Rs 1192 so far during the day. The stock had hit a 52-week high of Rs 1373.70 on 1 June 2009 and a 52-week low of Rs 354 on 27 October 2008.
The stock had underperformed the market over the past one month till 5 October 2009, rising 6.73% as compared to the Sensex 7.50% rise. It underperformed the market in past one quarter, falling 5.53% as against 13.10% rise in the Sensex.
The large-cap private sector power utility has an equity capital of Rs 226.42 crore. Face value per share is Rs 10.
The current price of Rs 1284.90 discounts the company's Q1 June 2009 annualised EPS of Rs 56.20, by a PE multiple of 22.86.
The stock had risen 1.26% to Rs 1220.80 on Monday, 5 October 2009, after reports suggested that the company plans to list at least the power distribution companies, Reliance Energy and Reliance Power Transmission in addition to its Metro projects unit. It may be recalled that Reliance Infrastructure has decided to form six subsidiaries as part of a demerger scheme. However, the scheme is yet to get approval from the the Bombay High Court.
A top company executive was quoted by the media as saying that the company is not in a hurry, but will list a few entities when it grows to substantial size. The estimation is that distribution, transmission and metro businesses will become mature for listing in one-two years, with the execution of existing and forthcoming orders.
About roping in strategic partners, media reports suggested that various investors have shown interest in the subsidiaries but the decision will be taken only when going to the public. The public offerings would be on similar lines to the Reliance Power initial public offer (IPO), the reports added.
Reliance Power, an electricity generation company, was hived off from Reliance Infrastructure, formerly known as Reliance Energy, and listed on Indian bourses after the country's largest initial public offering (IPO) of Rs 11,000 crore in early 2008.
Reliance Infrastructure's net profit rose 25.4% to Rs 316.57 crore on a 9.5% increase in sales to Rs 2407.22 crore in Q1 June 2009 over Q1 June 2008. The profit was boosted by higher energy sales and improved utilisation of power-generating plants.
The company posted a 9% rise in sales of electrical energy to 2,761 million units in Q1 June 2009 over Q1 June 2008. The Q1 June 2009 period also saw Reliance Infrastructure, which supplies power to most parts of suburban Mumbai, purchase 1,544 million units of power, which was higher by 7% compared to the offtake in the corresponding quarter of the previous year.
At the end of the June quarter, Reliance Infrastructure's cash and cash equivalents totaled Rs 9,000 crore while its engineering, procurement and construction (EPC) segment order book was at Rs 20,075 crore.
The company is engaged in generating, transmitting and distributing electricity. It also provides electrical contracting, engineering, procurement and construction contracts and computer services.
Promoters of the company have pledged 3.72 crore shares, or 16.53% equity. The total promoter holding in the company is 37.75%. (As on June 2009.)