Net sales grew 14.3% YoY to | 1245.2 crore driven by growth in PMC division (grew 20.7% YoY to | 1171.1 crore). However, sales was below our estimate of | 1363.0 crore mainly on account of lower than expected revenues in PMC division (| 1171.1 crore in Q1FY17 vs. our expectation of | 1259.5 crore) and real estate division (| 17.3 crore in Q1FY17 vs. our expectation of | 51.8 crore) • The EBITDA margin contracted 40 bps YoY to 3.5% and was below our estimate of 4.5% mainly due to higher un-allocable expenses (| 21.0 crore in Q1FY17 vs. our expectation of | 12.6 crore) • PAT grew 14.4% YoY to | 45.4 crore. However, it was below our expectation of | 59.4 crore mainly on account of higher effective tax rate (34.5% in Q1FY17 vs. 30.3% in Q1FY16) and EBITDA margin miss.

They are positive on NBCC’s business model given the huge set of opportunities, going ahead and expect its revenues/earnings to grow at of 34.4%/27.5% CAGR over FY16-FY18E. We also like NBCC given its negative working capital, cash rich balance sheet (| 1133.5 crore as on FY16) and strong return ratios (RoE of 26.3% & RoCE of 40.7% in FY18E), going ahead. Consequently,they maintain BUY recommendation with revised SOTP based target price of | 281 (implying 33.5x FY18E EPS).