Bharat Heavy Electricals Ltd. has secured contracts worth as much as 280 billion rupees ($3 billion) to supply equipment to Adani Power Ltd., highlighting rising private-sector spending on new power capacity. The state-owned engineering company received orders from the firm controlled by billionaire Gautam Adani for four projects, each with two 800-megawatt units, according to a statement Wednesday. Each contract is valued at between 50 billion and 70 billion rupees.
The contracts cover boilers, turbines and generators, along with auxiliary gear and related services, BHEL said. Following the announcement, BHEL shares rose as much as 6.3%, their biggest gain in six months. The stock has climbed 47% this year, sharply outperforming the benchmark Nifty 50 Index, which is down 9%.
The orders arrive two days after Finance Minister Nirmala Sitharaman said India will maintain infrastructure spending on roads, bridges and ports to support economic growth while preserving fiscal discipline. She said public investment remains important until the private sector steps up spending to expand existing operations or build new capacity.
The government's capital expenditure allocation has risen more than sixfold since fiscal 2015 to 12.2 trillion rupees in the year ending March, reflecting Prime Minister Narendra Modi's push to expand infrastructure.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing