GMR Infrastructure's (GIL) share price zoomed as much as 10 percent on Friday after the company's board approved to merge its non-airport business into a separate entity. The stock gained as much as 10 percent to hit its 52-week high of Rs 28.25 per share on the NSE. At 11:12 am, the shares erased all gains to trade 0.19 percent lower to Rs 25.65.

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"This restructuring is a step in the right direction to unlock the value of GIL through a separate listing of both the airport business and non-airport business and simplifying the corporate holding structure," said the company's exchange filing.

Post demerger, the company will become a pure-play airport company. The filing also said that the businesses are showing signs of recovery after the lockdown impact.

GMR Infra is deleveraging through asset sales and moving towards focused verticals, said N Jayakumar, MD, Prime Securities.

He further mentioned, "GMR Infra could also look at fundraising to pare its debt before the demerger. Also, the company will get a premium as very few infrastructure players come out from the bankruptcy."

In the quarter ended June 30, the company reported net revenue at Rs 957 crore as against Rs 1,505 crore in the corresponding quarter last year.

Net loss in Q1FY21 stood at Rs 834 crore as compared to the loss of Rs 335 crore last year.

Meanwhile, in the last five trades, the stock has seen 10 lakh shares exchanging hands. The stock during this period has surged over 30 percent to current levels.

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First Published:Aug 28, 2020 11:50 AM IST