Megha Engineering, a top buyer of electoral bonds, to sell its gas distribution business: Report

The company initially built pipelines for municipal projects and then progressively moved to bigger water and irrigation projects.

Hyderabad-based Megha Engineering and Infrastructures (MEIL), the second-biggest buyer of electoral bonds, is selling its city gas distribution business, the Economic Times has reported.

Megha City Gas Distribution (MCGDPL), MEIL's wholly owned subsidiary, has decided to consolidate operations, the report said, adding it has reached out to Indian Oil, Hindustan Petroleum, Bharat Petroleum and Indraprastha Gas among other companies.

The companies are evaluating the proposal and studying numbers and no decision has been taken yet.

A senior industry executive whose company evaluated MCGDPL's assets said it had not done much work on the ground and he pegged valuation at Rs 1,000 - 2,000 crore, the report added.

Moneycontrol couldn't verify the report immediately.

Hyderabad-based businessman P Pitchi Reddy (PP Reddy), who comes from a farming background, started Megha Engineering Enterprises in 1989. The company built pipelines for municipal projects and gradually moved to bigger water and irrigation projects.

The company was in news recently as it emerged as one of the top donors to political parties via electoral bonds. According to the information shared by the Election Commission of Indian, it donated around 60 percent of the total Rs 966 crore to BJP.

Separately, MEIL’s arm Western UP Power Transmission Company donated Rs 220 crore, of which almost half went to the Congress.

Also Read | Megha Engineering: Electoral bonds scheme unveils an infra giant out of a little-known entity

Rating agency CRISIL's data shows that MEIL's order book was a robust at Rs 1.87 lakh crore as on September 2023. While this is second to sector leader L&T’s order book of Rs 4.5 lakh crore, it is significantly higher than its peers. The company is executing projects across 20 states and two Union Territories in sectors such as irrigation, drinking water, highways and tunnels, ports, railways and power.