The shares of this small cap stock, engaged in providing services in energy, urban infrastructure and transportation sectors jumped over 15 percent in Tuesday’s trading session after the company announced disinvestment of stakes worth Rs 653 crore from its subsidiaries to Synergy Ltd.
Stock Performance
With a market capitalization of Rs 9,174.92 crore, GMR Power and Urban Infra Ltd surged over 15 percent in Tuesday’s trading session to a high of Rs 134.95 per share compared to its previous closing price of Rs 116.90.
What Happened
GMR Power & Urban Infra Ltd. has announced plans to de-lever its balance sheet by approximately Rs 4,400 crore through a series of strategic measures. These steps will also help facilitate a proposed one-time settlement with the lenders of its associate firm, GMR Rajahmundry Energy Ltd.
As part of this, GMR Energy (a wholly-owned subsidiary) and GMR Generation Assets Ltd. (a subsidiary) have entered into a framework agreement with Synergy Investments Holding Ltd. to divest equity as follows:
- GMR Energy will divest its 79.86 percent stake in Bajoli Holi Hydropower in two phases. Additionally, the relevant GMR Group entities will transfer 100 percent of the compulsorily convertible debentures issued by Bajoli Holi to Synergy.
- GMR Energy will transfer its 51 percent stake in GMR Vemagiri to Synergy.
- Upon completion of the proposed one-time settlement, GMR Generation Assets Ltd. will transfer 51 percent of the equity shares in GMR Rajahmundry Energy Ltd. to Synergy.
The GREL and Vemagiri power plants have been non-operational due to non-availability of affordable natural gas to operate the plants. The total consideration for the transfer is around Rs 653 crore, subject to adjustments for net working capital. The transactions are mostly expected to be finalized on or before September 30, 2025.
Also read: Adani Group stock in focus after reporting 320% QoQ increase in net profits in Q4 FY25
Company Overview
GMR Power and Urban Infra Limited primarily operates in the energy, urban infrastructure, and transportation sectors. The company is divided into several segments: Power, Roads, Engineering, Procurement and Construction (EPC), and Others.
Financial Performance
When looking at the latest financials, the company reported a 46 percent increase in revenue from Rs 1,103 crore to Rs 1,612 crore in Q3 FY24-25. The company saw a net loss of Rs 108 crore in this quarter as compared to a profit of Rs 43 crore during the same quarter last year
Written by Shwetha Sairam
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