Power Mech up 4% in a weak mkt; soars 54% in 1-mnth on strong order book

In the past three months, the stock soared 133 per cent, as against 7 per cent rise in the Sensex.

Shares of Power Mech Projects gained 4 per cent to hit a new high of Rs 2,089.45 in Friday’s intra-day trade, in an otherwise weak market. The stock quoted higher for fifth straight trading days as shares surged 21 per cent during the period. In comparison, the S&P BSE Sensex was down 0.41 per cent at 57,984 points at 12:32 PM.

In the past one month, the stock zoomed 54 per cent, on the back of strong order book position and clear visibility for the future. Moreover, in the past three months, it soared 133 per cent, as against 7 per cent rise in the S&P BSE Sensex.

Power Mech Projects bagged a record number of 5 Flue Gas Desulphurization [FGD] projects from Adani Group aggregating to Rs 6,163 crore for 15 FGD retrofits in coal based units. The Central Electricity Authority has identified 169,000 megawatt (MW) of existing coal based plants with 448 units out of 209,100 MW of installed base with 593 units needing FGD retrofitting. The company is aggressively pursuing for opportunities in the FGD segment for direct participation.

The company awarded a Mine Development & Operation (MDO) project from Central Coalfields Limited (CCL), a subsidiary of Coal India Limited, aggregating to Rs 9,294 crore over the contract period.

“This project will strengthen the already robust order book and enable the company to diversify its order book, in line with its strategy to have an optimum mix between power and non-power segments. The project will add more than Rs 400 crore annually to top line. With the revenue coming in from the O&M business and MOO projects, we expect to witness sustainable revenue with higher margins in the future,” Power Mech said.

Power Mech is an engineering and construction company which provides integrated service in erection, testing and commissioning (ETC) of boilers, turbines and generators and balance of plant (BOP), civil works and operation and maintenance (O&M). The company is now engaged in several power projects ranging from 135 MW to 800 MW, besides many projects in lower segment also.

The company plans to enter other related fields, including railway projects and execute major railway project of doubling tracks including electrification, signaling, culverts, platforms etc. The company has made its latest entry into transmission and distribution portfolio, mining of sand, and a new venture of diversification.

During the last 10 years, the company has built strong expertise in the field of railways, water projects, overseas operations, road projects, material handling, cross country pipelines, steel, oil & gas, etc., increasing the prequalifications.

"The investments under National Infrastructure Pipeline (NIP) of Rs 111 trillion with 24 per cent allocation to energy, 18 per cent to roads, 12 per cent to railways, and 17 per cent to urban development, will constitute 71 per cent of NIP allocations and play a major role in all round development," said Power Mech.