Patel Engineering hits upper circuit consecutively 2 days

Patel Engineering has emerged as the buzzing stock of Dalal Street once again. The shares of the company which on September 2 were blocked at upper circuit, on September 6 opened at Rs 77.40, hitting upper circuit for the straight second day, gaining almost 20 per cent. In the last two trading sessions shares of the company have surged by 44 per cent. In the last 5 days, shares have surged by 65 per cent.

On September 1, company had informed the bourses that it has won arbitration awards in excess of Rs 2500 crores. With this decision, company will get 75 per cent of this amount immediately, which the company will further utilise to retire its debt. The total debt of the company as on March 31, 2016 is Rs 4535 crores approximately. According to the company's management, cabinet’s decision on payment of arbitration awards to the construction company will help the company to infuse liquidity into the stressed entity and will help create more jobs. Company is assured that the debt of the company in the next 12-18 months will be reduced by 55 to 60 per cent.

Government's decision has boosted the morale of the Infrastructure segment, and another Infra major Brahmaputra Infra has received a similar arbitration award, seeing a similar movement in the share prices. Scrip of the company as at 2.00 pm is trading at Rs 37.10, up by 11.08 per cent from its previous close.

Patel Engineering is an integrated construction company specialising in hydropower generation, irrigation and urban infrastructure projects. It is the only Indian company with experience in RCC, Micro Tunnelling and Double Take Tap Work.