Shares of generator firms surge after power outage
Heavy computer-based trading caused a rush of orders for dozens of stocks, ranging from well-known bellwethers like General Electric to tiny Wizzard Software Corp, whose shares soared to $14.76 after closing the previous day at $3.50. The NYSE has cancele
Shares in diesel power generators rallied after a two-day blackout in India spurred hopes of increased sales of back-up electricity units.
Cummins India rose 2.5 percent, helped as well after US parent company Cummins Inc posted better-than-expected earnings on Tuesday.
Deutsche Bank said Cummins Inc is seeing potential for increased sales of standby generators after this week's blackouts.
"With respect to the recent grid failures in India, the company sees an opportunity for standby generators. The company is trying to provide solutions to stabilize the grid as well as provide emergency services," Deutsche said the US company told analysts in conference call.
Deutsche Bank added that Cummins Inc expressed confidence in its Indian operations, noting demand outlook is robust. The bank has a ‘Buy’ rating on the stock with a target price of Rs 515.
Among other diesel generator manufacturers, Greaves Cotton gained 2.6 per cent, after surging 3.5 per cent on Tuesday.