GMR surges on 50% stake sale in InterGen

MUMBAI: Shares of GMR Infrastructure were witnessing buying activity after the company sold 50 per cent stake in InterGen to Chinese electricity company Huaneng Power for $1.23 billion. The transaction is expected to close in the first half of 2011.

“We had valued the InterGen stake at Rs 3.4/ share and this deal is marginally lower than the same. We have reclassified our SOTP to enhance cash value and eliminate the InterGen valuation by a similar quantum; the same now stands at Rs 63/share.

We had recently upgraded our recommendation due to the positive structural changes from both operational and financial perspective; the deal re-enforces our view. We maintain ‘BUY / Sector Outperformer’ view on the stock,” said Edelweiss report.

At 12:35 pm; the stock was at Rs 46, up Rs 5.26 per cent on the BSE. It touched a high of Rs 46.40 and low of Rs 44.55 in trade so far. Around 6.39 lakh shares were traded in the counter against two-week average of 7.78 lakh shares.