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Power Grid Corporation of India surged over 5% after the state-run company said it has acquired two special purpose vehicles (SPVs) from the REC Power Distribution Company.

REC Power Distribution Company (RECPDCL), a wholly-owned subsidiary of REC under the Ministry of Power, has handed over two projects specific special purpose vehicles (SPVs) 'Fatehgarh Bhadla Transco' and 'Sikar New Transmission' to Power Grid Corporation of India.

The selection of Power Grid Corporation was carried out through tariff-based competitive bidding (TBCB) for the selection of transmission developers in line with the standard bidding documents and guidelines thereof as notified by the Ministry of Power.

Fatehgarh Bhadla Transco was incorporated for transmission system strengthening for evacuation of power from solar energy zones in Rajasthan (8.1 GW) under Phase II-Part B.

Sikar New Transmission was incorporated for transmission system strengthening scheme for evacuation of power from solar energy zones in Rajasthan (8.1 GW) under Phase-II - Part C.

The entire shareholding of both the SPVs, comprising of 50,000 equity shares, presently held by REC Power, has been transferred at par value along with all its assets and liabilities on 4 June 2021 to Power Grid Corporation of India.

On a consolidated basis, Power Grid Corporation of India reported a 26% jump in net profit to Rs 33.7 bn in the third quarter of 2021.

Power Grid Corporation of India was established by the government of India as the central transmission utility of India.

As of 31 March 2021, the government of India holds 51.3% in the electric utility manufacturing company.

Power Grid Corp's share price ended the day up by 5% on the BSE.

Speaking of the power sector, the power exchanged in India is about 4.5% of the overall power production, as can be seen in the chart below.

Moving on to news from the banking sector...

PNB Expects to Triple FY22 Net Profit, Identifies Rs 80 bn NPAs for NARCL

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Disclosure: Equitymaster Agora Research Private Limited (Research Analyst) bearing Registration No. INH000000537 (hereinafter referred as 'Equitymaster') is an independent equity research ...

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