REC climbs 3% as lender extends financial assistance to JBVNL, JUSNL

NEW DELHI: Shares of Rural Electrification Corporation (REC) climbed over 3 per cent in morning trade on Tuesday after the company inked Memoranda of Understanding (MoU) with Jharkhand Bijli Vitran Nigam (JBVNL) and Jharkhand Urja Sancharan Nigam (JUSNL) for extending financial assistance to the tune of Rs 15,150 crore.

In a filing to BSE, the lender said it would give financial assistance of up to Rs 8,150 crore to JBVNL and up to Rs 7,000 crore to JUSNL.

Following the development, the stock jumped 3.32 per cent to hit a high of Rs 155 on BSE. At the prevailing price, the stock is trading at 5.02 times its trailing 12-month earnings per share (EPS) and 0.53 times its book value.

The stock has been in news of late after the index maintenance sub-committee (IMSC) of IISL at its meeting held last week announced the addition of the scrip in Nifty100 and Nifty Next 50 indices with effect from March 31, 2017.