Shares of KNR Constructions hit a record high of Rs 475 after they rallied 17 per cent on the BSE in Tuesday's intra-day session ahead of the bonus issue share issue. The stock has surged 29 per cent in the past two days.
The company will allocate bonus shares in the ratio of 1:1 i.e. one bonus share for every one share held in the company on the record date.
The Executive Finance Committee of the company has fixed Thursday, February 4, as the record date for the purpose of proposed bonus issue. The stock will turn ex-date for bonus issue on Wednesday, February 3.
Since December 14, the stock of construction & engineering company has rallied 60 per cent after it announced the bonus issue proposal. In the past six months, it has zoomed 115 per cent as against a 32 per cent rise in the S&P BSE Sensex.
Meanwhile, the stock of infrastructure firms, mainly engaged in the business of roads and highways construction, continued their upward move for the second straight day after Finance Minister (FM) Nirmala Sitharaman on Monday announced a mega national highway project in poll-bound Tamil Nadu, West Bengal, Assam and Kerala.
The FM in her Budget speech said, “National highway works of 3,500 km for Rs 1.03 trillion will be undertaken in Tamil Nadu, 1,100 km projects for Rs 65,000 crore in the state of Kerala, 675 km for Rs 25,000 crore in West Bengal and Rs 34,000 crore worth of projects in Assam in the next three years."
“Roads & Highways were clearly the most resilient segment of infrastructure. On the overall capex front, for Roads and Highways, the revised estimates (RE) FY21E spends is pegged around 12 per cent higher at Rs 92,053 crore vs. budgeted estimates (BE) of Rs 81,975. Even for FY22E, the government has pegged the road capex at Rs 108230 crore, growth of 17 per cent YoY on a decent RE base. The government is also looking to provide alternative financing source by monetising five operating projects worth Rs 5,000 crore through NHAI INV,” ICICI Securities said in a note.
Analysts at Motilal Oswal Financial Services believe KNR Constructions’ strong balance sheet gives it a key competitive advantage versus peers in bidding for newer projects, and in terms of strong execution despite financing challenges in the sector as the dependency on bank financing is minimal.
At 11:03 am, the scrip was trading 16 per cent higher at Rs 471 on the BSE as against a 2.2 per cent rise in the S&P BSE Sensex. The trading volumes on the counter jumped three-fold with a combined 1.9 million equity shares having changed hands on the NSE and BSE so far.