Infrastructure share price target

Top Picks: PNC, Ashoka, NCC & Sadbhav. Top Picks Buildings: JMC Projects, Capacite. Tendering has continued to remain weak: Tendering in roads (by NHAI)has been virtually non existent in 9MFY19 as compared to the ~7,400km/Rs 1.2tn of awards in FY18. There is a likelihood of tendering picking up as we close in on the elections (with the model code of conduct to kick in). We could see at best ~Rs 500bn of actual awards over the next 2 months even though projects worth ~Rs 900bn are listed for tendering (EPC share is >70%).

Post decent demand growth of 10/9%YoY in 4QFY16/1QFY17, largely supported by favorable base effect and strong heat wave (particularly in April and May), All-India energy demand remained sluggish in 2QFY17 (disappointing 0/-1%YoY growth in Jul/Aug-16). With weak energy demand and increasing capacity, All-India PLF fell to 52% in Aug-16 (lowest level in past 4 years).

Top picks: Prefer select companies such as NCC (strong order book, valuation uptick from asset monetisation/deleveraging), KNR (strong BS, roads pure play), and PNC Infra (strong presence in states with large NHAI order pipeline).

Through our BOT Toll Monitor, a quarterly product, we try to analyse and find patterns in tollcollection figures of various projects across the country, thereby providing meaningful insights into the broader macroeconomic activity and the...

As the market grapples with global uncertainties (USDINR, crude, China), we find solace back home with strong momentum continuing in core infrastructure order awards and executionactivity.WhileNHAIseemstobewellontrackforawarding5,500kmofprojectsin...

2015), we publish the second edition. In this report, we anlayse the 2QFY16 toll collectionfiguresof47projectsspreadacross10statesand6companies.Wealso buckettheseprojectsintotheirrespectivestates,andtrytodeducethetollgrowth...

EVENT: Cabinet approves SEB Debt Restructuring Proposal The Union Cabinet has given approval to a new scheme (Ujwal DISCOM Assurance Yojna or UDAY'), as announced by the Ministry of Power. Key features of this scheme is that States shall take over 75% of DISCOM debt as on 30 September 2015 over the next two years - 50% of DISCOM debt to be taken over in FY16 and 25% to be taken in FY17. As per Ministry of Power, it will reduce the interest cost on the debt taken over by the States to around 8-9%, from as high as 14-15% currently; thereby...