PNC Infratech Ltd.– "Rating – BUY" - gEOJIT
CMP Rs120 Target Rs142
On the highway of growth...
PNC Infratech Ltd (PNC) is an Infrastructure construction, development and management company; expertise in execution of projects including highways, bridges, flyovers, airport runways, industrial areas and transmission lines.
- Strong order book of Rs 5,101cr (2.4x TTM revenue) provides strong revenue visibility for next 2-3years.
- The continued progress in awarding new road projects by NHAI and states will be major trigger for PNC to build their order book.
- Strong execution stimulated revenue by a CAGR of 12% over FY11-16 and improved EBITDA margin by 200bps to 13.2% in FY16.
- We expect revenue & PBT CAGR of 22% & 27% over FY16-18E. We assume normal tax rate would be applicable from FY18E onwards.
- At the CMP we value standalone business at a PE of 14x FY18E EPS and BOT projects at 1xP/B to arrive at SOTP target price of Rs 142 with a BUY rating
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