The Hindu Business Line : Infrastructure companies with diverse skill find favour

Mumbai, May 20 Shares of infrastructure service provider companies have seen a steep rise after the poll verdict in anticipation of the new Government’s likely thrust on infrastructure development.

Power sector is in focus due to the Government’s intention to narrow the huge-demand supply gap urgently.

As the Government has signed the nuclear deal, more actions on new nuclear power projects may gain speed after the Government is formed.

Companies that have diverse experience in infrastructure building (road, bridges and airports, among others) and are also in to power projects have a clear advantage of winning multiple contracts. Stocks of such companies have been in great demand.

Hindustan Construction Company – which has expertise in building road, bridges, real estate projects as well as in infrastructure for hydro and nuclear power projects – has gained 70 per cent since the poll verdict.

HCC gained 24 per cent on Wednesday to close at Rs 104 on the BSE.

Larsen and Toubro, which also has diverse experience in infrastructure project execution, has gained 37.56 per cent from Friday’s close.

L&T recently signed MoUs with four foreign companies for co-operation and expertise in executing nuclear power projects.

The companies that L&T has tied up with include GE Hitachi Nuclear Energy (US), Atomic Energy of Canada, Atomstroyexport (Russia) and Westinghouse Electric Company (US). L&T closed flat at Rs 1,359 on Wednesday after huge gains during the previous two sessions.

BHEL saw huge demand on Monday and Tuesday. The PSU major is up 19.5 per cent from Friday’s close. There was some profit-booking on Wednesday and the stock closed 5.75 per cent lower at Rs 2,040.

Areva T&D India Ltd – an Indian subsidiary of France-based Areva which is into transmission and distribution of power – has also seen heightened interest from investors as the parent company is into execution of nuclear power projects.

Areva T&D has gained 36 per cent during the last three session and it gained 12 per cent on Wednesday to close at Rs 329.80.

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