Genus Power shares rally 20% on GIC JV; stock up 46% in 4 days

Shares of Genus Power Infrastructures Ltd (Genus Power) surged 20 per cent in Wednesday's trade, taking its winning streak to the fourth straight session, as the company signed definitive agreements with Gem View Investment, an affiliate of Singapore's GIC for setting up of a platform for undertaking advanced metering infrastructure service provider concessions.

GIC will hold 74 per cent stake while Genus will hold 26 per cent stake in the platform, the company said in a BSE filing. The two partners have committed to an initial pipeline with a capital outlay of $2 billion. Genus would be the exclusive supplier to the platform for smart meters and associated services.

Following the development, the stock rose 20 per cent to hit a 52-week high of Rs 168.90. At this price, the stock is up 46.37 per cent in four sessions. It almost doubled this calendar so far.

The stock has been rallying as the company won received a letter of award (LOA) of Rs 2,207.53 crore for appointment of Advanced Metering Infrastructure Service Provider (AMISP) including design of AMI system with supply, installation and commissioning of 27.69 Lakhs Smart Prepaid Meters, Feeder Meter, DT Meter level energy accounting and FMS of these 27.69 lakh smart meters.

In the case of GIC JV, an affiliate of GIC Chiswick Investment Pte will invest up to Rs 590 crore by way of a preferential allotment of warrants, which would constitute 15 per cent of the issued and paid-up share capital of Genus on a fully diluted/as converted basis. The transactions are subject to the approval of Genus shareholders and fulfilment of customary closing conditions to the satisfaction of the GIC affiliates, Genus said.

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To recall, the government is implementing the National Smart Metering Project, under the Revamped Distribution Sector Scheme (RDSS), with a plan to install 250,000,000 meters by 2025 with an estimated investment of $30 billion. With technical and commercial losses exceeding 15 per cent (fifteen percent) for all major Indian utilities leading to high financial losses, smart metering projects under the RDSS scheme are conceptualised to reduce such losses, improve operational efficiency of DISCOMs and improve their financial sustainability by providing results linked financial assistance.

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