Buy NBCC with a target at Rs 1200: Reliance Securities
NBCC has withdrawn its fund-raising plan via FPO on the grounds that it can meet funding from internal accruals given the current strength of balance-sheet
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| Updated: Reliance Securities maintains a buy rating on NBCC post March quarter results with a 12-month target price of Rs 1200, after the company reported a healthy topline growth at Rs22.4 bn in 4QFY16 ahead of estimates mainly supported by healthy order book and execution ramp-up.
PMC, which forms 92 per cent of top line, grew by 45 per cent YoY, while EBITDA declined by 16 per cent YoY to Rs1.16bn below estimate of Rs1.45bn. Notably, NBCC has withdrawn its fund-raising plan via FPO on the grounds that it can meet funding from internal accruals given the current strength of balance-sheet.
"We view NBCC as a robust growth story on the backdrop of its PWO status and niche presence in re-development of government's old colonies," said the brokerage note. Further, strong and debt-free balance sheet and superior return ratios augur well for NBCC.
PMC, which forms 92 per cent of top line, grew by 45 per cent YoY, while EBITDA declined by 16 per cent YoY to Rs1.16bn below estimate of Rs1.45bn. Notably, NBCC has withdrawn its fund-raising plan via FPO on the grounds that it can meet funding from internal accruals given the current strength of balance-sheet.
"We view NBCC as a robust growth story on the backdrop of its PWO status and niche presence in re-development of government's old colonies," said the brokerage note. Further, strong and debt-free balance sheet and superior return ratios augur well for NBCC.
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