Patel Engineering Secures ₹240 Crore NHPC Contract, Shares Surge

Patel Engineering Limited (PEL) has seen a significant boost in its stock price, rising over 5% to ₹60.4 following the announcement of a new ₹240 crore contract with NHPC for the Teesta-V Power Station project in Sikkim. This contract encompasses crucial civil and hydro-mechanical works, specifically modifying the diversion tunnel into a tunnel spillway arrangement. The project is slated for completion within 18 months and further solidifies Patel Engineering's presence in the North Eastern region.

Recent Developments and Financial Performance

This latest contract adds to Patel Engineering's robust portfolio, which includes ongoing projects like NHPC's Teesta-VI project near Singtam, Sikkim. Last month, the company also secured a separate ₹317.60 crore contract in partnership with its joint venture partner. This project involves constructing a water-lifting arrangement for the Jigaon project in Maharashtra, covering various civil, mechanical, electrical, and allied works.

Financially, Patel Engineering reported a nearly 26% increase in consolidated net profit for the April-June 2024 quarter, reaching ₹48.17 crore compared to ₹38.29 crore in the same period last year. However, revenue from operations experienced a slight decline of 1.52%, standing at ₹1,101.66 crore, down from ₹1,118.61 crore a year prior.

Commitment to Infrastructure Growth

Kavita Shirvaikar, Managing Director of Patel Engineering, emphasized the company's commitment to driving long-term value for stakeholders. She expressed confidence in the company’s ability to enhance operational efficiency and contribute significantly to India's infrastructure development, particularly in the North Eastern region.

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Despite recent fluctuations, with shares having dropped over 17% in the past three months, the current contract win signals a positive outlook for Patel Engineering. The management remains focused on leveraging its established foundation to navigate challenges and seize opportunities in the growing infrastructure sector.