NCC Shares Rallies 50% in Last 6-Months, Hits 3-Year High

NCC shares have risen 19% so far in March as it won orders worth Rs 2,374 crore in February.

On Friday, shares of NCC, a civil construction company, surged nearly 5% to reach an over three-year high of Rs 106.36 in intra-day trade on the BSE. The stock was trading 3% higher compared to a 0.07% decline in the S&P BSE Sensex, at its highest level since June 2019.

This month, NCC’s market price has risen by 19% following the announcement of three new orders totalling Rs 2,374 crore (excluding GST) received in February 2023. These orders, received from state government agencies and PSU, include Rs 1,224 crore for the transportation division, Rs 830 crore for the water and environment division, and Rs 320 crore for the mining division. The consolidated order book of the company stands robust at around Rs 45,000 crore.

In the past six months, NCC’s stock has risen nearly 50% compared to a 2% decline in the S&P BSE Sensex. ICICI Securities analysts gave NCC a ‘buy’ rating with a target price of Rs 120 per share, citing strong execution and management guidance of continued traction and margin improvement. The management expects order inflows of around Rs 20,000 crore during FY23, with over Rs 17,300 crore worth of orders already received, including L1.

The company has maintained its topline guidance of approximately 30% YoY growth during FY23, driven by a higher executable order book and pick-up in execution with 100% operating efficiency.

The company anticipates a margin improvement of 20-30 bps in Q4, owing to the favourable raw materials prices. Moreover, the management foresees a continuation of the gained momentum in order inflows, with a strong focus on various segments such as affordable housing, water, roads and expressways, metro and railways, and mining.

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