Multibagger NBCC soars over 11% on new order worth ₹15,000 crore

Shares of NBCC (India) surged over 11 percent in intraday trading on Friday after the company secured a significant order worth ₹15,000 crore from the Srinagar Development Authority.

In a stock exchange filing, NBCC stated that the project involves the "development of a Satellite Township spread over 406 acres at Rakh-e-Gund Akshah, Bemina, Srinagar (J&K)." The MoU was signed by SDA’s Owais Ahmed and NBCC’s Sanjay Gupta. The project site is located adjacent to the upcoming Medi City and the High Court Complex, as per the company. NBCC will act as the project management and marketing consultant, handling the project from ‘concept to commissioning.’

The stock rose as much as 11.6 percent to reach the day's high of ₹188.50, now just 5 percent shy of its record high of ₹198.25, achieved on July 9, 2024. The stock has increased over 304 percent from its 52-week low of ₹46.61, set on August 14, 2023.

Over the past year, the stock has rallied 246 percent and it has gained 131 percent year-to-date in 2024.

The project will be completed in phases over five years and will include residential plots, villas, apartments, commercial offices, an indoor sports center, and 5-star resorts with modern facilities and amenities, according to media reports.

Approximately 3,200 affordable housing flats, each 45 sqm, are also planned for the project site. The project development cost, including site infrastructure, facilities, amenities, and affordable housing units, will be funded through a self-sustaining model from the revenue generated by the sale of proposed villas and commercial components.

Upon completion, the project is expected to serve as the New Town Centre for Srinagar residents and a hub for tourists, as noted by a company spokesperson.

On August 1, NBCC received an additional order from the Ministry of External Affairs to construct a regional passport office in Srinagar, J&K, valued at ₹50 crore.

Earnings

In Q4FY24, NBCC’s profit increased by 24.6 percent year-on-year to ₹141.5 crore, up from ₹113.6 crore in the same quarter the previous year (Q4FY23).

The company’s revenue surged by 43 percent annually to ₹4,025 crore in Q4FY24, compared to ₹2,814 crore in Q4FY23. Operating profit (EBITDA) more than doubled to ₹240.2 crore in Q4FY24, up from ₹104.5 crore in Q4FY23. The EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) margin increased by 230 basis points to 6 percent in the March quarter of financial year 2024, compared to 3.7 percent in Q4FY23.

NBCC is a construction company providing project management consultancy, real estate, engineering procurement, construction, civil engineering, and redevelopment services. The company also offers water treatment plants, water supply networks, including raw water mains, and solid waste management solutions.