Afcons rebounds 12% after clinching deal to build part of Bhopal metro line

Afcons Infra's bid of Rs 1,006.74 crore for the Bhopal metro line 2 package has been declared the lowest, making it the L1 bidder for the project

Afcons Infrastructure (AIL) shares climbed to Rs 470.70, bouncing back 12 per cent from their day's low on the BSE in Monday’s intra-day trade after the company was declared the lowest (L1) bidder for Bhopal metro project line 2 package BH-05. Afcons’ bid of Rs 1,006.74 crore was declared the lowest (L1) bid.

 

At 12:56 pm, Afcons Infrastructure share price was at Rs 470, nearly 2 per cent higher from its issue price of Rs 463 per share on the BSE. A combined nearly 53 million equity shares had changed hands on the NSE and BSE.

 

Shares of the Shapoorji Pallonji Group's flagship company, AIL, made a subdued debut on the bourses today. On the BSE, AIL shares listed at Rs 430.05, reflecting a discount of 7.01 per cent against its IPO issue price. Further, the stock had dipped 9 per cent to hit intra-day low of Rs 419.85 on the BSE after listing.

 

 

The company today announced that it was declared as the lowest bidder for construction Package BH-05 of the Bhopal Metro Phase 1 project’s 12.915 km Blue Line (Line-2) which will connect Bhadbhada Chauraha – Ratnagiri Tiraha via 13 elevated stations.

 

This package by Madhya Pradesh Metro Rail Corporation Ltd (MPMRCL) includes the construction of the entire Blue Line’s viaduct, 13 stations, and a ramp leading to Subhash Nagar Depot which will be shared with Orange Line (Karond Circle – AIIMS) for maintaining and stabling.

 

MPMRCL had invited bids for the Blue Line’s construction, financed by the European Investment Bank (EIB) through a (Euro) €400 million loan. The contract comes with a three year construction deadline.

 

AIL’s diverse portfolio includes marine and industrial, surface transport, urban infrastructure, hydro and underground, and oil and gas projects. With a significant international footprint, AIL derives about 30 per cent of its revenues from exports, operating in Asia, Africa, and the Middle East. Over the past 11 years, AIL has completed 79 projects in 17 countries, totalling Rs 56,305 crore in contract value.

 

As of June 30, 2024, AIL had 65 active projects across 12 countries, with an order book totalling Rs 31,747 crore. The company's order book to sales ratio for FY24 stood at 2.4x, providing revenue visibility for the next two to three years. Additionally, as of September 30, 2024, the company was an ‘L1 bidder’ for projects worth Rs 10,732.36 crore.

 

AIL’s current projects include the Kolkata Metro tunnels under the Hooghly river, the Male to Thilafushi Link Project in the Maldives, and a 21 km tunnel for the Mumbai-Ahmedabad high-speed rail corridor, featuring India’s first 7 km undersea rail tunnel.

 

With the government’s initiatives aimed at infrastructure development, including increased budgetary allocations and the rapid pace of urbanisation, AIL is strategically positioned for substantial growth, according to Geojit Financial Services, considering its extensive experience in completing high-value and complex projects that offer better margins.  Moreover, geographical diversification with operations spread across multiple sectors broadens the company's revenue base and mitigates risks, the brokerage firm had said in the company's IPO note.