NCC Q2 results: Net profit doubles to Rs 163 cr on higher order inflows

Indian infrastructure firm NCC on Thursday reported its profit more than doubled in the second quarter, helped by higher order inflows.

Consolidated net profit rose to 1.63 billion rupees ($19.3 million) for the quarter ended Sept. 30 from 773.4 million rupees a year ago.

Revenue from operations rose 10.1% to 51.96 billion rupees. While total expenses rose 7.6% to 49.74 billion rupees, the cost of materials consumed, which forms more than a third of expenses, fell 1.2%.

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KEY CONTEXT

In the July-September period, NCC saw healthy order inflows worth 35 billion rupees, led by buildings and transportation orders, analysts at Elara Capital said in a pre-earnings note.

Construction companies also benefited from lower prices of key raw materials. Domestic steel prices dropped to an over three-year low in the quarter, per data from commodities consultancy BigMint. Cement prices hit a five-year low in the quarter amid ample supply, according to Ambit Capital.

PEER COMPARISON

Valuation (next Estimates (next 12 Analysts' sentiment

12 months) months)

RIC PE EV/EBIT Revenue Profit Mean No of Stock to Div

DA growth growth rating* analysts price yield

target** (%)

NCC NULL 8.61 15.77 32.04 Buy 10 0.87 0.71

KNR 18.95 12.99 6.84 1.25 Buy 13 0.90 0.08

Constructions

PNC Infratech 11.59 13.64 1.14 -4.77 Buy 14 0.66 0.18

Ashoka 14.50 13.61 7.76 47.41 Buy 8 0.97 Null

Buildcon

* The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell

** The ratio of the stock's last close to analysts' mean price target; a ratio above 1 means the stock is trading above the PT

JULY-SEPTEMBER STOCK PERFORMANCE

-- All data from LSEG IBES

-- $1 = 84.3340 Indian rupees