PNC Infratech Ltd. share price target

We retain our BUY rating on the stock with a target price of Rs 385/share, implying an upside of 39% from the CMP.

Reported EBITDA at | 165.5 crore was down 7.3% YoY with margin at 10.9%, down 263 bps YoY. The company has booked | 39 crore towards impairment of Ghaziabad Aligarh Expressway Pvt Ltd. (associate company)....

We recommend a Buy the stock for a target price of Rs 350 implying an upside of 15% from CMP

EBITDA margin improved by 23bps to 13.7% aided favourable project mix and lower employee cost (as a % of revenue). PNC has not received any orders in H1FY22 however, the order book remains healthy at Rs13,178cr which is 2.3x TTM revenue and provides revenue visibility for two to three years. PAT grew by 95% YoY helped by lower tax rate of ~26% (vs 36% in Q2FY21) and higher other income. H1FY22 revenue grew by 46% YoY and the company has guided...

We maintain a BUY on PNCIL and value EPC business at 13 x FY24E EPS and HAM portfolio at 1x book value to arrive at a target price of Rs 430, implying an upside of 30% from CMP.

Road sector contribute 72% to order book: H1FY22 Order book at Rs132bn (equals 2x TTM Revenue) comprises of roads at 72% and water and Irrigation projects at 28%. Q2FY22 order inflow stood at Rs27bn. Going forward, company is targeting an order inflow of Rs80bn (HAM: EPC at 50:50) in FY22. Also company is targeting to bid for NHAI projects worth Rs250bn in the coming 2-3 months and also expects project opportunities under the Jal Jeevan Mission. Balance sheet continues to remain lean: On standalone, Net cash is at Rs1.7bn. On Consolidated, Gross Debt/ Cash and Bank balance at Rs44bn/ Rs11bn implying Net...

We initiate coverage with a BUY rating and value the company's EPC business at 14x FY24E EPS and HAM portfolio at 1x book value, to arrive at a target price of Rs 440/share. TP implies an upside potential of 24% from the CMP.

Q1FY22 Snapshot: PNCL revenue increased by 38% YoY at Rs13bn. EBITDA was up by 47% YoY with EBITDA margin of 14.0% vs 13.2% YoY. PAT stood at Rs0.9bn (up 55% YoY) led by EBITDA increase and lower interest. PNCL targets FY22 revenue at 20% YoY with EBITDA margin at ~13.5-14%. FY22 Tax to be at 28.5%. Focus shift back to road sector: Q1FY21 Order book at Rs121bn (equals 2x TTM Revenue) comprises of roads at 90% and water and Irrigation projects at 10%. But going ahead, PNCL is focusing more on road sector and looking to stabiles the existing order win in water supply and irrigation. In Q1FY22, order inflow is Rs17bn and for...

Second wave of Covid- A temporary blip in execution: We expect subdued execution in Q1FY22 impacted by second wave led partial lockdowns. 1Q revenues stand affected by 1) lower execution given labour availability fell by ~20-25% v/s pre-covid levels (mainly in Apr-May'21) and 2) toll collections dipped 15-20%, as economic activity witnessed slowdown. However, on low base in FY21 due to complete lockdown(s), revenues are expected to see a growth of 55% YoY (average). EBITDA margins are likely to be impacted by higher pandemic related cost and negative operating leverage. We expect execution to approach normalcy...