Key Points of PNC Infratech Secures NHAI Project:
- PNC Infratech wins a Rs 1,260 crore highway project and emerges as the lowest bidder (L1).
- The six-lane greenfield project will connect Varanasi-Ranchi-Kolkata and will be in “Hybrid Annuity Mode.”
- The project will be constructed in 24 months and operated for 15 years post-construction.
- PNC Infratech’s share prices surged over 5% to Rs 299.90 following the announcement.
- The recent order win has boosted PNC Infratech’s order book and increased revenue prospects for upcoming financial years.
- PNC Infratech is actively working on 23 projects, including 6 BOT and 1 OMT project.
- The company’s order book as on Q3FY2023 stood healthy at Rs 17,842 crore.
- Nirmal Bang Institutional Equities has a target price of Rs 375 on the PNC Infratech stock and expects significant revenue growth in FY24.
Details of PNC Infratech Secures NHAI Project:
PNC Infratech Bags Rs 1,260 Cr Highway Project, Emerges as Lowest Bidder
PNC Infratech, an Indian infrastructure construction, development, and management company, witnessed a surge in its share prices on Wednesday after it emerged as the lowest bidder (L1) for the national highway project between Varanasi and Kolkata, connecting Ranchi. The stock price surged over 5% to Rs 299.90 during the early trading session on Wednesday.
The six-lane greenfield project, which is likely to be in “Hybrid Annuity Mode,” will connect Varanasi-Ranchi-Kolkata from Pachmon village to Anarbansalea village under Bharatmala Pariyojana in the state of Bihar. The total cost of the project is expected to be around Rs 1,260 crore, and the project will be constructed in 24 months and operated for 15 years post-construction, as per the company’s exchange filing.
Following the announcement, PNC Infratech’s share price jumped more than 5% to Rs 299.90 on Wednesday, before settling at Rs 290.60 at 12.25 pm. The civil construction company’s shares closed at Rs 284.65 on Tuesday.
PNC Infratech has expertise in executing major infrastructure projects, including highways, bridges, flyovers, power transmission lines, airport runways, development of industrial areas, and other infrastructure activities. The recent order win has boosted its order book, increasing its revenue prospects for the upcoming financial years. The company’s valuations offer a better risk-reward ratio to investors, according to brokerage firms.
PNC Infratech has made considerable investments in brand development and has emerged as a prominent contractor in the construction industry. It is actively working on 23 projects, including six BOT and one OMT project with both toll and annuity assets. It has one HAM project with 13 HAM projects under development, as per Nirmal Bang Institutional Equities.
According to Sharekhan, PNC Infratech has been declared the L1 bidder for two HAM projects of NHAI in Bihar, aggregating Rs 2,004 crore. The order wins are critical due to nil order inflows during 9MFY2023 due to aggressive competitive bidding and weak sectoral tendering.
The order book as on Q3FY2023 stood healthy at Rs 17,842 crore (2.6x TTM standalone revenues), while receipt of new orders in the near term would aid healthy growth for FY2024 and FY2025, it said.
“The company expects total revenue of up to Rs 900 crore for FY23 from drinking water projects. Revenue from the Water and Irrigation segment (Jal Jeevan Mission) is likely to start contributing significantly from 2HFY23, driving higher revenue growth in FY24,” said Nirmal Bang Institutional Equities, with a target price of Rs 375 on the stock.
About PNC Infratech:
PNC Infratech, previously known as PNC Construction Company Private Limited, was founded on August 9, 1999. The company became a limited company in 2001 and changed its name to PNC Infratech Limited in 2007. PNC Infratech Limited is recognized as one of the leading infrastructure development, construction, and management firms in the country. Its core business is to undertake a variety of infrastructure projects such as highways, bridges, flyovers, power transmission lines and towers, airport runways, industrial area development, and other related activities.
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