GMR Power and Urban Infra Soars 10% on Smart Metering Project and Acquisition

             Stock Surges After a Recent Dip

 

Shares of GMR Power and Urban Infra Ltd (NS:GMRP) witnessed an impressive 10% surge, reaching Rs 36.6 per share, bouncing back from a 10% decline in the previous session.

Smart Metering Project in Uttar Pradesh

The prominent construction engineering company, known for its prowess in power and infrastructure development services, made a significant announcement on September 13, 2023. The company revealed that it had secured a Letter of Intent (LOI) for a smart metering project in Uttar Pradesh (UP) from its former step-down subsidiary, GMR Smart Electricity Distribution (GSEDPL).

Scope of the Smart Metering Project

Under the awarded LOI, GMR Power and Urban Infra will be responsible for the installation, integration, and maintenance of 75.69 lakh smart meters. These meters will serve Purvanchal Vidyut Vitran Nigam (PuVNL), covering the Varanasi, Azamgarh zone, as well as Prayagraj, Mirzapur zone, and Dakshinanchal Vidyut Vitran Nigam, encompassing the Agra and Aligarh zone, all within UP.

Contract Details and Timeline

The company is set to install, integrate, and maintain 25.52 lakh smart meters specifically in the Dakshinanchal area, including Agra and Aligarh zone. The total contract value for Agra & Aligarh Zone stands at approximately Rs 2,469.71 crore, and the project is slated to be executed within 27 months from the contract's initiation, followed by an operating period of 93 months.

Expansion Through Acquisition

In addition to its project success, GMR Power and Urban Infra has expanded its reach by acquiring a 100% stake in its subsidiary, GMR Smart Electricity Distribution (GSEDPL). This move increases the company's effective holding in GSEDPL from roughly 82% to 100%.

 Acquisition Details

The acquisition was carried out by purchasing the entire 50,000 equity shares of GSEDPL, each with a face value of Rs 10. The transaction amounted to a total cash consideration of Rs 5 lakh, based on an independent valuer's assessment.

 Opportunity in Midcap Stocks

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