PNC Infratech nears record high; stock surges 47% in two months

In the past two months, the stock has outperformed the market by surging 47 per cent, as compared to a 2 per cent rise in the Sensex.

Shares of PNC Infratech hit a 52-week high of Rs 219, up 7 per cent, in intra-day trade on the BSE on Wednesday in an otherwise subdued market after CARE reaffirmed the credit ratings assigned to the bank facilities of its subsidiaries.

The stock was trading close to its all-time high level of Rs 228, touched on December 27, 2017, on the BSE in intra-day trade. In comparison, the S&P BSE Sensex was up marginally by 0.04 per cent or 14 points at 39,830 at 12:17 pm. A combined 467,341 shares changed hands on the counter on the NSE and BSE so far.

Rating agency Credit Analysis & Research Limited (CARE) ratings have reaffirmed credit rating on the bank facilities of PNC Chitradurga Highways Private Limited and of PNC Khajuraho highways Private Limited.

Last week, CARE had revised the ratings of the bank facilities of PNC Delhi Industrialinfra Private Limited (PDIPL) to CARE BBB+ with positive outlook.

“The revision in the ratings of the bank facilities of PDIPL factors in the favorable Arbitration Award and Judgment of Hon’ble High Court of Delhi in favor of the company with respect to non-receipt of annuities leading to receipt of Rs 189 crore from Delhi State Industrial and Infrastructure Development Corporation (DSIIDC) towards entire pending annuities and interest on the same,” CARE Ratings said in press release on June 28.

In the past two months, the stock has outperformed the market by surging 47 per cent, as compared to 2 per cent rise in the Sensex.

PNC Infratech has guided strong performance in FY20 and is expecting around 45-50 per cent yoy growth in topline. EBITDAM (earnings before interest, income taxes, depreciation, amortization, and management fees) is likely to be between 13.7-14 per cent (excluding benefit from any bonus/arbitration awards).

Brokerage firm Equirus Securities has ‘long’ rating on the stock with a target price of Rs 230 per share.

“The outstanding order book backlog, which needs to be completed over the next 2-3 years, gives us confidence on PNC Infratech posting a 29 per cent revenue CAGR over FY19-FY22E. We feel PNC Infratech would deliver on the execution front, though more order inflows could hamper management bandwidth and execution deliverance,” analysts at the brokerage firm said in Q4FY19 result update.