Shares of Power Grid gained around 1.5% on Thursday after the company received a letter of intent (LoI) to build an inter-state transmission system for evacuation of power from Barmer in Rajasthan to South Kalamb in Maharashtra.
State-owned Power Grid, in an exchange filing, said it was declared as a successful bidder under the tariff-based competitive bidding process to establish the transmission system at quoted annual transmission charges of Rs 3,244 crore. The shares of the company rose to Rs 270.75 apiece on NSE on Thursday morning.
The project comprises establishment of 6,000 MW, ±800 kV HVDC terminals at Barmer in Rajasthan and South Kalamb in Maharashtra, along with augmentation of South Kalamb. The project also involves construction of a ±800 kV HVDC bipole line between Barmer-II and South Kalamb (1,000 km) traversing through the states of Rajasthan, Gujarat and Maharashtra, and construction of 400 kV transmission lines traversing through the state of Rajasthan along with the associated bays. Additionally, Power Grid will also install two SynCon units at Barmer-II PS along with the associated bays.
In late August, Power Grid announced that it acquired Fatehgarh II Transmission, the project SPV to establish an inter-state transmission system for installation of two synchronous condensers (SynCon) units at 765/400/220kV Fatehgarh-II PS, on a build, own, operate and transfer (BOOT) basis.
Power Grid shares have gained nearly 1% over the past week but dropped more than 7% over the past month. The stock has fallen 7% over the past year.
In the longer term, the shares of the state-owned company have jumped more than 41% over three years and 103% over five years. The company has a market capitalisation of over Rs 2.48 lakh crore.
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Should you buy, sell or hold Power Grid shares?
Geojit Institutional Equities recently upgraded its rating on the shares of Power Grid to ‘Buy’ with a target price of Rs 303 apiece, implying more than 14.5% upside potential from the stock’s previous closing price of Rs 264.55 apiece. The brokerage, in a post-earnings note, said Power Grid remains the premier proxy on India's structural transmission capex upcycle, with a multi-year runway underpinned by rising renewable integration, HVDC expansion, and emerging demand from data centres and green hydrogen.
The company’s dominant ISTS positioning, presence across both regulated and competitively-bid frameworks, and steady diversification into telecom, consultancy and grid-support solutions (BESS, synchronous condensers) reinforce long-term strategic relevance, it added.
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