Sector reform hopes lift Neyveli Lignite

DALAL STREET SPIKES

The stock price of Neyveli Lignite jumped up 5.83 per cent to Rs 78.05 on Tuesday following heavy buying at the counter.

The main reason for the interest in the stock is the gains for the company from the power sector reforms. The scrip price opened at Rs 75 and went to a high of Rs 81.60 in intra-day deals. On the BSE the stock saw 24.43 lakh shares changing hands.

Power sector stocks recorded gains for the second consecutive day on Tuesday. The Neyveli Lignite scrip has appreciated more than 100 per cent in six months.

It is one of the largest power producing companies in India with a production capacity of around 2,400 mw. It is also engaged in mining of lignite.

An immediate reason for the rise in the stock price is the approval by the government of the company's thermal power project at Rs 1,400 crore.

This will augment its production capacity by around 250 mw.