Geojit's research report on NCC
NCC Limited (NCC) is one of the largest well diversified construction companies in India with a foothold in every segment of construction sector. NCC reported a robust revenue growth of 56% YoY in Q1FY23 backed by its strong order book and pick up in execution. However, EBITDA margin declined by 105bps YoY to 9.5% due to higher commodity prices and higher sub-contracting expenses (62% YoY). Order book remained healthy at Rs 40,616cr (3.7x TTM revenue), supported by a strong inflow of Rs 4,456r in Q1FY23. The management expects traction in order inflow with emphasis on affordable housing, Jal Jeevan Mission, roads, and railway, while it refrained from guidance. With a strong order book, the company has guided for revenue growth of 15% to 20% for FY23, with a 10% EBITDA margin.
Outlook
Given strong order book, healthy balance sheet and pick up in execution, we maintain Buy rating and value at a P/E of 11x on FY23E EPS with a TP of Rs.89.
More Info
At 11:51 hrs NCC was quoting at Rs 74.70, up Rs 0.40, or 0.54 percent.
It has touched an intraday high of Rs 75.70 and an intraday low of Rs 74.55.
It was trading with volumes of 120,951 shares, compared to its thirty day average of 335,807 shares, a decrease of -63.98 percent.
In the previous trading session, the share closed up 0.47 percent or Rs 0.35 at Rs 74.30.
The share touched its 52-week high Rs 87.45 and 52-week low Rs 51.00 on 15 September, 2021 and 21 June, 2022, respectively.
Currently, it is trading 14.58 percent below its 52-week high and 46.47 percent above its 52-week low.
Market capitalisation stands at Rs 4,690.01 crore.
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