Penny stock hits upper circuit after receiving LoA from Adani Group worth ₹ 20.93 Cr 

Shares of this penny stock hit the 2 percent upper circuit after the company announced successfully receiving a Letter of Award (LoA) worth Rs 20.93 crores from an Adani Group company. In the past month, the company’s stock rose nearly 10 percent for its holders. 

With a market capitalization of Rs 93.39 crores, the stocks of Power & Instrumental (Gujarat) Limited started their trading session on Tuesday hitting its 2 percent upper circuit at Rs 75.05 and are currently locked at the same share price level. The company’s scrip is inching towards its 52-week high price recorded at Rs 93.45 apiece. 

Such sharp bullish movements in the company’s share price were observed after the company, through a regulatory filing with the Bombay Stock Exchange (BSE), intimated about successfully receiving a Letter of Award (LoA) from “Ahmedabad International Airport Limited”, an Adani Group Entity, worth Rs 20.93 crores. 

The LoA pertains to the development of a ‘Substation’ for ‘Terminal 2’ at Sardar Vallabhbhai International Airport, Ahmedabad, and the same is decided to be executed within four months from the effective date of receipt of LoA, viz, 7th May 2024. 

During the recent financial quarters, the company’s basic business indicators, viz, its operating profits as well as after-tax profits, witnessed a dip in numbers with the former reducing from Rs 24.33 crores during Q2FY24 to Rs 15.13 crores Q3FY24, and the latter, during the same period, slipping from Rs 1.39 crores to Rs 82 lakhs. 

In addition to the above, the company’s ratio analysis portrays the return ratios, i.e., the return on equity (RoE) as well as the return on capital employed (RoCE), reported at decent numbers during FY23 with the former reported at 8.10 percent and the latter at 16.50 percent. 

Founded in 1975, Power & Instrumental (Gujarat) Limited is engaged in the business of electrical contract works and also deals in electrical equipment in India. The company provides contract-based, industrial electrical, power backup, and other services for commercial electrical contractors. 

Written by Amit Madnani

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