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    Buy Ahluwalia Contracts (India), target price Rs 500: Centrum Broking

    Synopsis

    Ahluwalia Contracts (India) Ltd., incorporated in the year 1979, is a Small Cap company (having a market cap of Rs 2535.14 Crore) operating in Construction sector.

    buy-sell
    It values AHLU at 15x FY23E EPS and have a price target of Rs500.
    Centrum Broking has buy call on Ahluwalia Contracts (India) Ltd. with a target price of Rs 500. The current market price of Ahluwalia Contracts (India) Ltd. is Rs 373.7. Time period given by analyst is one year when Ahluwalia Contracts (India) Ltd. price can reach defined target.

    Ahluwalia Contracts (India) Ltd., incorporated in the year 1979, is a Small Cap company (having a market cap of Rs 2535.14 Crore) operating in Construction sector.

    Financials
    For the quarter ended 31-03-2021, the company reported a Consolidated Total Income of Rs 765.18 Crore, up 41.46 % from last quarter Total Income of Rs 540.91 Crore and up 38.59 % from last year same quarter Total Income of Rs 552.12 Crore. Company reported net profit after tax of Rs 37.05 Crore in latest quarter.

    Investment Rationale
    AHLU is finally showing the much awaited acceleration in execution of its strong order backlog. While execution in Q1FY22 is likely to be weak again due to Covid 2nd wave impact, we expect recovery starting Q2FY22 and estimate 21% revenue CAGR over FY21-23. The healthcare sector comprises 58% of AHLU’s order backlog and is likely to be a key driver of both fresh inflows and execution in FY22/FY23. With the adverse impact of provisions and write-offs in legacy projects behind, the brokerage expects a return of historical margin levels of 12-13% in FY22/FY23, leading to a robust 70% CAGR in earnings. The stock trades at 11.7x FY23E EPS and offers potential to re-rate further. It values AHLU at 15x FY23E EPS and have a price target of Rs500.



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    (What's moving Sensex and Nifty Track latest market news, stock tips and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .)

    Download The Economic Times News App to get Daily Market Updates & Live Business News.

    Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.

    Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

    ...more
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