PNC Infra plunges on debut on NSE

MUMBAI: PNC Infrastructure listed at Rs 387, a premium of 2.38 per cent, against issue price of Rs 378 on the National Stock Exchange. However, the stock plunged 7.14 per cent below the issue price to touch intraday low of Rs 351 on the back of weak market sentiment.

PNC Infratech is Agra-based infra player having focus on roads & highways construction. In FY2012, it diversified into BOT-Toll & Annuity projects and in FY2014 into OMT projects.

Currently, the company is executing 23 engineering procurement construction ( EPC) projects (1 through JV route), 7 BOT projects (including 2 Annuity projects) and 1 OMT project. 3 of the 7 BOT projects are already operational. Another 4 are likely to be operational in the next 12 months.

With no more BOT projects in the pipeline, PNC’s dependency on BOT projects for EPC works has substantially declined from what it was two years ago.

Currently, 12 per cent of the EPC order book comes from in-house BOT projects and this should further decline in the next 1-2 quarters.

According to Angel Broking, the stock has potential to get re-rated on account of panning out of possible triggers, which include 1) commencement of Tolling/ Annuity across 4 BOT projects, 2) news flow pertaining to better execution and stable EBITDA margins (at ~13%) and (3) gradual build-up in the company’s track-record as a listed entity.