HDFC Securities is bullish on Ashoka Buildcon has recommended buy rating on the stock with a target price of Rs 141 in its research report dated June 17, 2020.
HDFC Securities' research report on Ashoka Buildcon
We maintain BUY on Ashoka Buildcon with revised TP of Rs 141/sh. Adjusting for ~Rs 1bn release of contingencies in revenue from some of the projects, ABL missed our earnings estimate by 18% on account of weak execution and lower than expected EBITDA margin. Labour availability is 50-65% as of now and sites are working at 50-65% efficiency. Tolling has reached 85% of pre-Covid-19 level within three week of resumption. NWC days improvement, low net D/E of 0.04x and comfortable liquidity insulates ABL from COVID-19 headwinds.
Outlook
We revise our FY21E/FY22 EPS by 6/34% and increase our TP to Rs 141/sh (vs Rs 134/sh earlier).
For all recommendations report, click here
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