HCC sinks 16% from day's high on Rs 406 crore consolidated net loss in Q1

Hindustan Construction Company's shares tumbled 8 per cent to hit an intra-day low of Rs 6.2 on the BSE on Friday after the company on Thursday reported consolidated net loss of Rs 406.26 crore for June 2020 quarter (Q1FY21). It had logged a net profit of Rs 99.74 crore in the year-ago period.

The shares had jumped leaped 10 per cent in the morning deals today to hit a high of Rs 7.4 apiece, translating into an intra-day fall of 16.2 per cent. A combined 24.92 million shares had changed hands on the counter on the NSE and BSE till the time of writing of this report. 

For Q1FY21, the engineering and construction firm's total income stood at Rs 1,689.82 crore, compared with Rs 2,815.21 crore in the year-ago quarter. "The revenue of construction companies was impacted by the nationwide lockdown, resulting in halting of construction, non-availability of labour and disruption in supply chain," the company said in a statement. It recorded turnover of Rs 462.3 crore for the quarter ended June 30, 2020, registering a yearly decline of 53 per cent

That apart, it has recorded an exceptional loss of Rs 242 crore "on account of conciliating an NHAI award for Rs 219 crore". It added that this was done to generate immediate liquidity in operations given the difficulties presented by the Covid-19 pandemic.

On standalone basis, the net loss was Rs 217.4 crore, compared with Rs 5.4 crore-loss reported in Q1FY20. EBITDA came in at Rs 113.1 crore, down from Rs 193.4 crore YoY and EBITDA margin slipped to 24.9 per cent from 19.7 per cent YoY.

"The impact of Covid on our industry and economy cannot be understated. We expect the aftershocks to be felt for many months and are altering our business plans accordingly. Our focus has

remained on normalising our operations while working solutions with our Clients, including raising liquidity through conciliations of claims,"  Arjun Dhawan, Director & Group Chief Executive Officer said in a statement.

On the upside, HCC secured new projects including Rs 1,900 crore NHAI order to construct a 22 km highway link between Jharkhand and Bihar, Rs 4,167 crore contract for Bhadbhut barrage in Gujarat, and Rs 1,335 crore Rail Vikas Nigam order to construct 8.04 km BG rail line between Rishikesh and Karanprayag in Uttarakhand.

At 1:38 pm, the stock was trading 7 per cent lower at Rs 6.25 per share, as against 0.75 per cent rise in the benchmark S&P BSE Sensex.