Infra shares extend rally on fiscal stimulus hopes

Lanco Infra, NCC, Peninsula Land, GMR Infra, HDIL, JP Assoc & Reliance Infra are up 5-8% on the BSE

Shares of infrastructure companies have extended their week long rally on hopes of a fiscal stimulus of upto Rs 1 lakh crore from the government.

“The government is working on a mechanism for expeditious release of pending dues of companies of around Rs 1 lakh crore, mostly to those operating in infrastructure space, as part of its efforts to spur investments,” the report suggests.

Last week, in a high level ministerial meeting chaired by the Prime Minister, the government announced major infrastructure initiatives to boost the economy. During the meeting, targets were set for award of key projects in roads, airports, railways and ports.

 

“Given the slow pace of approvals for major projects in the recent past, such a decision may at the very least increase the pace of tendering of key projects,” according to analyst at Barclays Research.

Meanwhile, the finance minister Pranab Mukherjee may ask the bankers to increase lending to the infrastructure sector in their meeting with the chiefs of state-owned banks on tomorrow, added report.

Among the individual stocks, Lanco Infrastructure, NCC, Peninsula Land, GMR Infrastructure, HDIL, Jaiprakash Associates and Reliance Infrastructure are trading higher 5-8% on the Bombay Stock Exchange.