Lanco Infratech rallies over 8% on asset sale plan to reduce debt

NEW DELHI: Lanco Infratech Ltd surged as much as 8.04 per cent in a weak market on Wednesday, after media reports suggested that the company has decided to sell up to 3000 mw of power generation assets to raise up to Rs. 15000 crore in cash and thereby retire part of the company debt of over Rs. 36,000 crore.

At 10:40 a.m.; Lanco Infratech was trading 6.5 per cent higher at Rs 8.61. It hit a low of Rs 8.31 and a high of Rs 8.73 in trade today.

The company had recently divested the 1320 mw Udipi thermal power plant to Adani Group entity for Rs. 6,000 crore and Budhil hydel project earlier for Rs. 650 crore to Greenko and about 10 mw of wind generation assets, all with a view to bringing down its piled up debt, said the report.

Faced with challenges the company retrenched 30 per cent of its 5,700 workforce during the last financial year due to slowdown in development of some of its projects amid subdued market conditions.

According to the latest annual report of the infra major, the group, which had a workforce of 5,700 by the end of March 2013, cut down its workforce to 4,000 by the end of March this year. By the end of FY12, it had nearly 8,000 employees, the report said.