Power Grid: Growth concerns eclipse benign valuations, healthy dividends

Steady financial performance notwithstanding, shares of Power Grid Corp. of India Ltd trailed behind broader markets by a big margin. The stock lost about 9% in the past year in contrast to the 5% rise in the Nifty 500 index.

The company reported a 52% jump in profit and revenue gained 18% for the March quarter. But the stock was little changed on Thursday as investors seem to take no cheer from this.

That is because the performance is partly supported by prior period income. Weighing on the Power Grid stock is weakening growth outlook. Project starts or capitalization during the year dropped 29% at the stand-alone level, showed data compiled by Motilal Oswal Financial Services Ltd.