During Thursday’s trading session, the shares of a dominant player in the iron & steel industry jumped 8.3 percent to hit a record high at Rs. 253.6 on BSE, after the company announced signing an agreement with GAIL to supply RLNG Gas.
With a market cap of Rs. 15,874.8 crores, at 01:18 p.m., the shares of Godawari Power & Ispat Limited (GPIL) were trading in the green at Rs. 237.3, up by around 1.4 percent, as against its previous closing price of Rs. 234.1.
What’s the news:
According to the latest regulatory filings with the stock exchanges, Godawari Power & Ispat Limited entered into an agreement with GAIL (India) Limited.
The agreement is for the supply of RLNG Gas for the company’s upcoming pellet plant in the ordinary course of business for a period of 7 years.
Previous News:
In November, GPIL entered into a definitive agreement to acquire up to 51 percent stake in Jammu Pigments Limited (JPL) at a post-money valuation of ~Rs. 500 crores. With this acquisition of the recycling business, the company entered the non-ferrous segment.
GPIL completed the acquisition of a 49 percent stake in JPL on a fully diluted basis and the balance is to be acquired in compliance with certain conditions.
JPL is a non-ferrous metals recycling company that has plants spread across Kathua (J&K) and Kota (Rajasthan).
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Financials:
Godawari Power reported a marginal decline in revenue from operations, experiencing a year-on-year fall of nearly 2 percent, from Rs. 1,291 crores in Q2 FY24 to Rs. 1,268 crores in Q2 FY25.
Similarly, its net profit decreased during the same period from Rs. 257 crores to Rs. 159 crores, representing a decline of nearly 38 percent YoY.
The fall in Revenue & Profitability was on account of lower production volumes of Iron Ore Pellets and a fall in sales realisation of finished products like sponge iron, billets etc, despite higher volumes of finished products. The profitability was also impacted by an increase in other operating costs for maintenance of the Pellet plant.
Stock Performance:
The stock has delivered positive returns of nearly 74 percent in one year, as well as around 13.4 percent returns in the last six months. So far in 2024, the shares of Godawari Power have given positive returns of about 54 percent.
About the company:
Incorporated in 1999, Godawari Power & Ispat Limited (GPIL) is mainly engaged in the business of mining of iron ore and manufacturing of iron ore pellets, sponge iron, steel billets, wire rods, HB wire and ferro alloys with the generation of electricity.
Written by Shivani Singh
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