GVK Power in deep red

GVK Power is down 2.25% at Rs.6.95, its current intra day low and very close to its 52-week low of Rs.6.87. Market cap stands at Rs.1097 crore.

The stock is down as its exploration project with BHP Billiton now faces some uncertainty. The company has to now wait for the go-ahead from the defence ministry. The company has seven deepwater blocks with mining major BHP Billiton as its partner and a defence nod is necessary to take the exploration works further. Several other projects too, have hit defence and security issue.

The state of its road projects is also not too encouraging as that too seems to have a roadblock. Concession agreements for most of the road projects are being returned back from NHAI on grounds of right of way, environmental clearances and restrictions imposed by the Supreme Court. Thus that too currently stands in a limbo.