GMR Power in limelight

Shares of GMR Power have seen a sharp move over the past week, rising about Rs.15, even as trading volumes have tapered off, suggesting tightening free float. The stock was trading around Rs.113–115 today, down marginally on the session, but remains well above its recent lows, with the near-term support seen around Rs.109.

Market participants are closely watching the board meeting scheduled for tomorrow to consider fund-raising of up to Rs.1,200 crore via a preferential equity issue, which has added to speculative interest in the counter.

According to Mr.S.P. Tulsian, the recent price action, coupled with shrinking delivery volumes, indicates that strong hands may have absorbed available supply. He remains constructive on the stock, citing improved operating performance in Q2FY26, where revenue rose 28% YoY to Rs.1,922 crore, and a sharp improvement in reported profitability driven by exceptional income. The Supreme Court’s judgment, which upheld earlier APTEL and Orissa High Court rulings and set aside an arbitral award in favour of SEPCO, removed a contingent liability of Rs.1,147 crore that had earlier weighed on the company.

Operationally, GMR Power’s energy business reported healthy plant load factors of 73% and 81%, while the smart metering segment continued to scale up, with 20.3 lakh meters installed till October-end and segmental profit rising 82% QoQ to Rs.31 crore. The company also made progress on receivables, collecting a large portion of overdue amounts post quarter-end. However, consolidated EBITDA declined 18% YoY, reflecting pressure in parts of the EPC and energy portfolio, and net debt remains elevated at around Rs.10,050 crore.

At the current market capitalisation of about Rs.8,450 crore and an enterprise value of roughly Rs.18,500 crore, the stock trades at around 10.5x EV/EBITDA on a trailing basis, which some analysts view as reasonable given the improving balance sheet and resolution of legacy disputes.

Mr. Tulsian sees significant upside potential over the medium to long term, and the outcome of the proposed equity issuance, progress on pending claims, and sustained cash-flow improvement will be watched.