Shares of Gayatri Projects slipped 18 per cent to Rs 31 on the BSE in intra-day trade on Friday, amid heavy volumes, after the National Highways Authority of India (NHAI) declared the company a non-performer and prohibited from participating in the ongoing and future bids for the road projects till defects and deficiencies in one of the company’s projects were rectified.
At 01:38 pm, the stock of Gayatri Projects was down 11 per cent at Rs 33.70, as against a 0.34 per cent rise in the S&P BSE Sensex. The trading volumes on the counter jumped 10 times, with a combined 10.57 million shares or nearly 6 per cent of the total equity of Gayatri Projects having changed hands on the NSE and BSE so far.
On clarification on the recent NHAI announcement, Gayatri Projects informed the stock exchanges that NHAI officials had found some deficiencies in the Varanasi Sultanpur 4-laning project in UP, where Gayatri is one of the contractors.
“The above project was awarded in January 2016. Out of the total 138Km section, 4-laning has been completed for 129Km, almost 93 per cent of the project, This project has been beset by the continued delay in handing over of the land by NHAI. In addition, the land handover has been done in bits and pieces, resulting in overall project delay. Apart from pending land handover, certain works have been halted due to pending approvals and payments to be released by NHAI,” Gayatri Projects said.
The company further said it requested for extension of completion time till October 2021 in anticipation of handing over of balance land and clearing of all pending approvals and payments. Approval of extension of time is under active consideration at NHAI, it added.
“The rectification of deficiencies identified has been delayed on account of the second wave of the Covid-19 pandemic. However, the company is engaged in active discussions with the relevant authorities and has raised their objections citing certain technical difficulties at the site. The company will work closely with the authorities to rectify the deficiencies at the earliest and expects the issue to be resolved in the next 2-3 months,” it said.
