JSPL surges to a new high

Jindal Steel & Power (JSPL) is the top gainer on the BSE currently. It jumped up 13% to hit a new high today at Rs.270.30. It has come off this high but remains firmly in the green, up 7.5% at Rs.258 levels.

The reason for this surge today is the company’s plans to raise funds. The company stated that it plans to raise Rs.1000 crore through qualified institutional placement (QIP) route in Feb’18.

The funds raised through the QIP are to be used to repay debt and clear dues pertaining to working capital and expansions.

JSPL also plans to raise another Rs.1500 to 2000 crore by listing its Oman subsidiary, Jindal Shedeed on foreign bourses.

QIP is essentially a product which runs strongly in a bull market. It is usually issued at a discount to the market price and thus in a current market, where we are seeing more ups than downs, it gives investors an opportunity to make instant money on allocation.