Infrastructure stocks on Thursday surged in the range 0.54 per cent to 11.71 per cent after the government allowed developers to divest 100 per cent equity in projects two years after the completion of such schemes.
The decision is aimed at fast-tracking contracts and implementation of highway projects in the country by making additional funds available for investment.
Reacting to the news shares of infrastructure stocks like Jaiprakash Associates settled with gains of 11.71 per cent, while Hindustan Construction Company ended the day higher by 2.49 per cent.
The government’s move is expected to benefit infra stocks and accordingly IRB Infrastructure closed for the day up 4.28 per cent, while, GVK Power and Infrastructure was up 0.54 per cent and Unity Infraprojects was up 4.09 per cent.
Other infrastructure stocks also ended the day on a higher note. Ashoka Buildcon was up 3.78 per cent, while Gammon Infrastructure rose by 8.55 per cent.
The approval would allow the highway developers to use proceeds from the sale of divested equity in incomplete projects of NHAI or any other road projects besides any power sector projects or to retire their debt to financial institutions in any other infrastructure works, the statement said.
This move will help unlock equity from completed projects making it potentially available for investment into new projects, the statement added.
