Jaiprakash Associates shares rally for eighth consecutive session, jumps 40% so far this month; here is why

Shares of debt-laden construction company, Jaiprakash Associates, have been witnessing a strong buying interest since the start of this month after trading restrictions were lifted by stock exchanges. Jaiprakash Associates shares rallied for eighth consecutive session on Tuesday, August 12, and it has surged as much as 40.53% so far this month to hit an intraday high of ₹4.23, data from the National Stock Exchange (NSE) showed.

Jaiprakash Associates shares have been rising by their daily maximum limit of 5% in seven out of eight trading sessions in August. The stock has been witnessing buying interest after reports suggested that billionaire Gautam Adani-led Adani Group last month approached Competition Commission of India (CCI) to acquire Jaiprakash Associates.

As per reports Adani Group has made an unconditional bid for the debt-ridden company which is undergoing a corporate insolvency resolution process (CIRP).

Jaiprakash Associates is an infrastructure conglomerate with interests in engineering and construction, cement, power, real estate, and hospitality. The company developed vast chunks of land in Greater Noida in the Delhi-NCR region and has flagship properties like Jaypee Greens in Greater Noida and the Jaypee International Sports City, strategically located near the upcoming Jewar International Airport.

It also has three commercial/industrial office spaces in Delhi-NCR, while its hotel division has five properties in Delhi-NCR, Mussoorie, and Agra.

The company also owns four cement plants in Madhya Pradesh and Uttar Pradesh, and a few leased limestone mines in Madhya Pradesh. The cement plants, however, are non-operational.

It also has investments in subsidiaries, including Jaiprakash Power Ventures Ltd, Yamuna Expressway Tolling Ltd, Jaypee Infrastructure Development Ltd and several other companies.

In a notice to CCI, Adani Enterprises, Adani Infrastructure and Developers and Jaiprakash Associates have said the "proposed combination does not raise competition concerns in any plausible relevant market and therefore, the relevant market delineations may be left open.

Last month, Dalmia Cement (Bharat) Ltd also submitted a notice and sought clearance from the fair trade regulator CCI to acquire 100% stake in JAL, including its assets and proportionate shareholding in its subsidiaries, associate companies and joint ventures.

Earlier, lenders of Jaiprakash Associates have turned down Jaypee Infratech's request to accept its resolution plan to acquire the bankrupt diversified company.

As of 12:16 pm, Jaiprakash Associates shares were locked in 5% upper circuit with over 1.91 crore pending buy orders for its shares on the NSE while there were no sellers seen on the exchange.