Godawari Power hits new high in a weak market; stock zooms 39% in 11 days

Shares of Godawari Power and Ispat hit a new high of Rs 742.75, up 7 per cent on the BSE in the intra-day trade on Thursday, bouncing back 12 per cent from the day's low of Rs 664. The stock surpassed its previous high of Rs 724 hit on Tuesday, March 23.

In the past 11 trading days, the stock of iron & steel/intermediates products company has zoomed 39 per cent after the company got approval for ‘consent to operate' the enhanced capacity of iron ore pellet plant and consent to set up manufacturing facilities in other divisions.

On March 15, the Chhattisgarh Environment Conservation Board, Raipur had accorded its approval for 'Consent to Operate' enhanced capacity of iron ore pellet plant from 2.1 million to 2.4 million tons per annum (TPA) with immediate effect.

Similarly, the Chhattisgarh Environment Conservation Board, Raipur also accorded its "Permission to Establish' the proposed expansion and modernization of existing manufacturing facilities along with integration of existing environmental clearances at exiting plant location, the company said. It further said the capex required for the above expansion will be invested out of internal accruals of the company.

Last month, Godawari Power had said that the company has started booking export orders of high grade iron ore pellets (65.5 per cent Fe) to China and Other Countries. "The first export order of 50,000 MTs has already been booked and the delivery will take place in the month of April, 2021.Going forward the Company will mainly concentrate on production and export of high grade iron ore pellet only," it said.

With increase in domestic demand Godawari Power, in an investor presentation, said it has shifted sale in local market and reduced export volumes. Majority of pellet are now sold in domestic markets.

At 03:12 pm, the stock was trading 3 per cent higher at Rs 711 on the BSE, as against a 1.8 per cent decline in the S&P BSE Sensex. A combined around 390,000 equity shares had changed hands on the counter on the NSE and BSE till the time of writing of this report.