Shares of JKumar Infraprojects Limited (JKIL) rallied by almost 5 percent on Friday on the Bombay Stock Exchange (BSE) after a brokerage upgraded the stock on the basis of the company winning contracts awarded under the Mumbai Metro Line 3 project.
The JKIL stock was trading at Rs. 162.15, up 4.99 percent from its previous close, at around 2 p.m. on the BSE.
The company announced in a regulatory filing to the BSE on Thursday that the value of the contracts was about Rs. 5,012 crore.
In a note, Edelweiss Securities Ltd. said that JKIL stands to gain a lot from the contracts awarded by the Mumbai Metro Rail Corporation (MMRC) for its Line 3 project to four civil contractors, including JKumar, for six packages.
"We envisage significant fillip to JKIL's execution as the Line 3 project comprises ~50% of the company's order book," Edelweiss analysts Parvez Akhtar Qazi, Rita Tahilramani and Manoj Bahety said in their note.
"The agreement signing paves way for commencement of work on the mammoth project. This will be the 6th metro rail contract under execution for JKIL, cementing its position as the premier metro rail player in the country," they added.
Promoters hold 43.47 percent stake in JKIL with the rest held by others, including Indian mutual funds and foreign portfolio investors.
The company will be declaring its June quarter results on Sept. 2.
The stock has dropped 27 percent from its July 26 closing price of Rs. 223.55 and substantially from its 52-week high of Rs. 449.75.
The BSE Sensex was trading 107 points down at 27,728, at about 2.20 p.m. Top Sensex losers include Wipro, Larsen & Toubro, Adani Ports, Infosys and State Bank of India.
GAIL (India), Tata Motors and Reliance Industries were top index gainers.