ICICI Direct recommended is bullish on PNC Infratech has recommended buy rating on the stock with a target price of Rs 235 in its research report dated May 28, 2019.
ICICI Direct's research report on PNC Infratech
PNC Infratech’s (PNC) revenues grew significantly by 41.7% YoY to Rs 1075.7 crore in Q4FY19 led by strong execution and was above our estimate of Rs 790.3 crore. Adjusting for bonus received in Q4FY18, EBITDA margins grew 50 bps YoY to 14.1%, better than our estimate of 13.5%. RPAT grew 25.5% YoY to Rs 139.9 crore in Q4FY19. Adjusting for Rs 65.8 crore tax rebate, Rs 7 crore profit on sale of investment in Q4FY19 and bonus receipts in Q4FY18, it reported 37.2% PBT growth YoY to Rs 108.8 crore in Q4FY19.
Outlook
PNC’s robust order book, strong execution capabilities & lean balance sheet along with prudent WC management reinforce our confidence that the company is well placed to capture huge opportunities ahead. With a strong ramp up in execution to continue in FY20E, we expect revenue growth at a 27.4% CAGR to Rs 5,028.1 crore in FY19-21E. Hence, we maintain our BUY rating on the stock with a target price of Rs 235/share. We value its construction business at Rs 198/share (at 8.5x FY20E EV/EBITDA implying 14.8x FY20 EPS) and BOT & HAM projects at Rs 49/share.
For all recommendations report, click here
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