Shares of Bharat Heavy Electricals Ltd (BHEL) rallied 5% on 9 January after the company announced securing a Rs 5,400 crore order in Odisha from its joint venture with Coal India Ltd. This is order described as a “related party transaction.”

The order is for the coal gasification and raw syngas cleaning plant (LSTK 1 Package) of the JV Bharat Coal Gasification and Chemicals Ltd.’s (BCGCL) coal to 2,000 TPD ammonium nitrate project in Odisha.

The contract covers design, engineering, equipment supply, civil works, installation, commissioning, and operations and maintenance (O&M) for the LSTK 1 Package.

The preliminary acceptance, which includes commissioning and a performance guarantee test, is set for 42 months. The O&M services are for 60 months from the date of preliminary acceptance.

According to the corporation, the order is done at “arms length” and falls within related party transactions.

BHEL’s shares plunged more than 10% on Thursday after Reuters reported that the Indian government is considering lifting restrictions on Chinese companies tendering for government contracts. The report caused shares of BHEL and its other Capital Goods peers, including ABB India, Siemens India, and L&T, to fall by 4% to 6%.

At 10:42 pm, the shares of BHEL were trading 3.70% higher at Rs 281.80 on NSE.

Ready to invest like a pro? Tradz by EquityPandit equips you with 100+ Free tools and knowledge you need to succeed. Download the Tradz app and gain access to daily stock lists and insightful market analysis and much more!