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Sterlite Tech gains after Sterlite Grid refinances project loan

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Sterlite Technologies rose 2.63% to Rs 68.20 at 14:15 IST on BSE after its subsidiary, Sterlite Grid has successfully refinanced East North Interconnection Company project loan with significantly favorable terms as compared to the earlier debt.

The company made announcement during market hours today, 23 February 2015.

Meanwhile, the S&P BSE Sensex was down 148.00 points or 0.51% at 29,083.41.

On BSE, so far 6.68 lakh shares were traded in the counter as against average daily volume of 3.83 lakh shares in the past two weeks.

The stock hit a high of Rs 70.30 and a low of Rs 65.10 so far during the day. The stock had hit a 52-week high of Rs 79.30 on 18 November 2014. The stock had hit a 52-week low of Rs 19.05 on 3 March 2014.

The stock had outperformed the market over the past one month till 20 February 2015, gaining 7.79% compared with 1.55% rise in the Sensex. The scrip had, however, underperformed the market in past one quarter, declining 10.38% as against Sensex's 4.15% rise.

The mid-cap stock has equity capital of Rs 78.79 crore. Face value per share is Rs 2.

Sterlite Grid (Sterlite), a subsidiary of Sterlite Technologies has successfully refinanced East North Interconnection Company (ENICL) project loan within three months of the project becoming fully operational in November 2014. The new financing arranged by Axis Bank, consists of a long term loan of Rs 925 crore, with significantly favorable terms as compared to the earlier debt.

This refinancing is in line with Sterlite's stated objectives of recycling capital for increasing returns on investment. With this transaction, Sterlite has not only achieved reduction of 175 basis points in the interest cost on per annum basis, but also released more than Rs 150 crore after repaying its outstanding debt obligations to the existing financial institutions. It is the first inter-state private power transmission asset to get refinanced with such favorable terms, reflecting keen interest of financial institutions in funding power transmission projects with stable long-term cash flows. The East-North Interconnection will generate predictable and stable cash flows for more than two decades.

Sterlite has six transmission projects in portfolio, out of which, ENICL, India's first Ultra Mega Transmission Project was recently commissioned enabling northern region to import surplus power from North-Eastern & Eastern Regions. ENICL project was identified as one of the highest priority projects by Power System Operation Corporation (POSOCO) as it provides critical connectivity for transfer of power from the power plants in the North Eastern (NE) region. It involves establishment of two 400 kV Double Circuit transmission lines. All the other transmission projects are in various stages of development and will be completed soon as per schedule, company said.

Sterlite Technologies' net profit jumped 325.5% to Rs 23.06 crore on 31.2% rise in total income to Rs 897.05 crore in Q3 December 2014 over Q3 December 2013.

Sterlite Technologies offers products for extra high voltage data and power transmission.

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First Published: Mon, February 23 2015. 14:06 IST