PNC Infra surges 9%, nears record high on strong order book position

As of March 31, 2021, the value of contracts under PNC Infartech's execution stood at Rs 11,648 crore

Shares of PNC Infratech surged 9 per cent to Rs 284 on the BSE in intra-day trade on Wednesday, gaining 15 per cent in the past two days, amid heavy volumes after the company said it has a strong order book of over Rs 11,600 crore. The stock of the roads and highways construction company was quoting close to its record high level of Rs 291 touched on February 11, 2021.

At 10:41 am, PNC Infratech stock was up 7 per cent at Rs 278, as compared to a 0.52 per cent rise in the S&P BSE Sensex. The trading volumes on the counter more-than-doubled, with a combined 3.3 million shares having changed hands on the NSE and BSE so far.

“As of March 31, 2021, the remaining value of contracts under execution of Rs 11,648 crore. After considering the two engineering, procurement, and construction (EPC) road projects, seven EPC water projects, the order book is over Rs 16,600 crore,” PNC Infra said in an investor presentation.

The road EPC projects constitute 89 per cent of PNC Infra's order book. After considering the EPC value of the above projects, contracts under execution are over Rs 16,600 crore, which is over 3 times FY21 revenue, the company said.

PNC Infratech’s execution was robust for the quarter, with stronger-than-expected topline and higher margins led by operating leverage. Topline came in at Rs 1,644 crore, up 42 per cent year-on-year (YoY), driven by improved executable order book and optimum labour availability. The consequent margins were at 14.1 per cent, up 63 basis points (bps) YoY. Profit after tax (PAT) came in at Rs 129.4 crore, up 70 per cent YoY, despite higher taxation, led by strong operating performance and lower interest costs.

"Healthy order book, comfortable leverage and working capital remain strengths of the company. Government focus on roads and the company’s foray into other key segments including water bodes well," ICICI Securities said in a note.