News

The Indian stock markets opened flat today, July 8, due to concerns over US President Donald Trump's fresh tariff measures took centre stage. At 2.11 PM IST, the Sensex was up 60.52 points at 83,503.02, and Nifty50 was at 25,459.10, down 2.20 points. 

Meanwhile, analysts are bullish on a Navratna PSU stock NBCC. This is a civil construction company, works in three different verticals- project management consultancy (PMC), engineering, procurement, and construction (EPC) Projects, and real estate Development.

Brokerage Elara Capital has initiated coverage on NBCC shares and has given a 'buy' rating with a target of Rs 165. It is up by more than 40 per cent from the current level. The stock had made a low of Rs 71 in the first week of March, and from there it has seen a good recovery of about 65 per cent in the last four months.

The brokerage said that it has been a preferred Central Public Sector Enterprise (CPSE) for redevelopment projects on government land, completing stuck private realty projects, and constructing buildings and hospitals. The company's earnings have grown at a CAGR of 47 per cent between FY20-25 while the earnings of other engineering PSUs have been only 8 per cent CAGR during this period. This earnings momentum is expected to continue in the coming years. 

The brokerage believes that the company's revenue growth can be 24 per cent and earnings growth 23 per cent between FY25 and FY28. The company is debt-free, margins are stable, return ratio is over 20 per cent, operates on an asset-light model, and the working capital cycle is very short. The order book and outlook are also strong. In such a situation, the brokerage has started coverage.

Five government companies work in the engineering and consultancy segment. These companies are NBCC, EIL, RITES, IRCON, and RVNL, which play an important role in India's infrastructure development and project management. Between FY20 and FY25, NBCC's earnings grew at a CAGR of 47 per cent while margins strengthened by 4 per cent. The order book is strong. On the other hand, the industry growth during this period has been 9 per cent CAGR. EBITDA margin has been stable, but order inflow has not been consistent.

In the last two years, NBCC stock has gained over 330 per cent and more than 460 per cent in the last three years. However, the shares have increased by 24 per cent till YTD (year-to-date).

At around 3 PM IST, shares of NBCC were trading at Rs 115.8 each, down 0.22 per cent on BSE today.

The views/suggestions/advice expressed here in this article are solely by investment experts. Zee Business suggests its readers consult their investment advisers before making any financial decision.

Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.

LATEST NEWSBy accepting cookies, you agree to the storing of cookies on your device to enhance site navigation, analyze site usage, and assist in our marketing efforts.