Expansion Plan Powers Godawari Power & Ispat

Godawari Power & Ispat galloped 5.30% to Rs 160 at 9:55 IST on BSE, after the company said it has signed a memorandum of understanding with the state government of Chhattisgarh for setting-up a 1000 megawatt thermal power project.

The company made this announcement after trading hours on Thursday, 18 September 2008. Meanwhile, the BSE Sensex was up 491.49 points, or 3.69%, to 13,807.09. Stocks rose across the globe on reports US policymakers will work through the weekend on a plan that will focus on dealing with illiquid assets -- the toxic source that has shattered balance sheets, pushed Lehman Brothers to file for bankruptcy protection and prompted the US bailout of American International Group this week. On BSE, 10 shares were traded in the counter. The stock had an average daily volume of 33,568 shares in the past one quarter. The stock hit a high of Rs 160 and a low of Rs 160 so far during the day. The stock has a 52-week high of Rs 376.50 on 1 January 2008 and a 52-week low of Rs 149.05 on 24 March 2008. The small-cap stock had underperformed the market over the past one month till 17 September 2008, falling 26.09% as compared to the Sensex’s decline of 9.92%. It had also underperformed the market in the past one quarter, declining 20.84% as compared to the Sensex’s decline of 15.51%. The company’s current equity is Rs 28.07 crore. Face value per share is Rs 10. The current price of Rs 160 discounts Q1 June 2008 annualized EPS of Rs 54.22, by a PE multiple of 2.95. In July 2008, Godawari Power & Ispat signed a memorandum of understanding with the government of Chhattisgarh for setting up cement plants and power plant in the state at a total cost of Rs 628 crore. Godawari Power & Ispat’s net profit rose 81.7% to Rs 38.05 crore on 88.3% rise in sales to Rs 320.44 crore in Q1 June 2008 over Q1 June 2007. The company is engaged in manufacturing steel intermediate products like sponge iron and ferro alloys and finished long steel products like billets, wire rods and mild steel wires, which find application in the construction and infrastructure sectors. The group operates in three segments namely steel, electricity and others.