PNC Infratech (PNCINF) | 152

Result Update

ICICI Securities Ltd | Retail Equity Research

HAM projects to keep execution strong…

PNC Infratech’s (PNC) revenues grew significantly by 108.0% YoY to

| 558.6 crore in Q2FY19 led by strong execution. However, it was

below our expectation of | 603.3 crore

EBITDA margin contracted 142 bps YoY to 13.4% on account of

higher raw material expenses (68.3% as percentage of revenues in

Q2FY19 vs. 65.3% in Q2FY18) and in line with our estimate of 13.6%

PAT grew robustly by 110.9% YoY to | 35.1 crore in Q2FY19, below

our expectation of | 59.4 crore mainly on account of lower-than-

expected topline growth and higher tax rate of 21.6% in Q2FY19

Strong order book provides revenue visibility…

PNC’s orderbook was strong at | 6119 crore, providing strong visibility

over the next two to three years. However, this does not include some

projects viz. two EPC packages of Purvanchal Expressway worth | 2520

crore, Nagpur-Mumbai expressway EPC package worth | 2000 crore and

three HAM projects worth | 3834 crore. Including these projects, PNC’s

orderbook is strong at over | 14000 crore. The company received

appointed date for both Purvanchal Expressway packages on October 10,

2018, which may start contributing to revenues from Q4FY19E. Appointed

date for Nagpur-Mumbai Expressway is expected in December, 2018.

Taking cues from such a sharp execution pick-up in FY19E, we expect a

robust topline growth of 45.1% to | 3911.3 crore in FY18E-20E.

Healthy bid pipeline ahead...

NHAI has invited bids for 70 EPC & 30 HAM projects worth | 70,000 crore,

with due date expected in the next two to three months. These bids

include 1250 km Delhi-Mumbai Expressway (25 packages) and 1316 km

Amritsar-Jamnagar Expressway (22 packages), which are the biggest of

these. The major component of these projects is expected on an EPC

basis. PNC expects incremental | 4000 crore of opportunities in H2FY19E

from above mentioned bid pipeline.

Equity requirement worth | 832 crore for HAM projects...

PNC has seven HAM projects with bid project cost of | 8897 crore in its

kitty. While four of these projects are under execution, three are in the

process of receiving financial closure. These projects have total equity

requirement of | 832 crore of which ~| 50 crore was infused in FY18. The

company will infuse an aggregate of | 220 crore, | 250 crore & | 312 crore

in FY19E, FY20E & FY21E, respectively, which will be met through internal

accruals. Also, it has plans to monetise four of its BOT assets, of which,

Ghaziabad-Aligarh BOT asset is undergoing due diligence while talks on

the term sheet are underway. With a lean balance sheet, strong internal

accruals & inflows from monetisation of some projects, funding this equity

requirement should not be an issue for PNC.

Buoyant orderbook lends comfort for strong execution; maintain BUY…

PNC’s robust order book, strong execution capabilities and lean balance

sheet with better WC management reinforce our confidence on the future

prospects of the company. Also, we believe PNC is well poised to capture

huge opportunities ahead. We expect revenues to grow at a CAGR of

45.1% in FY18-20E given the significant ramp-up in execution from FY19E

onwards with receipt of appointed dates for several big-ticket projects.

Hence, we maintain our BUY rating on the stock with a target price of |

190. We value its construction business at | 164/share (at 8x FY20E

EV/EBITDA) and BOT & HAM projects at | 53/share (traffic growth

assumption - 5% per annum).

PNC Infratech (PNCINF) | 152 Rating matrix

Rating : Buy

Target : | 190

Target Period : 12-18 months

Potential Upside : 25%

What’s changed?

Target Changed from | 215 to | 190

EPS FY19E Changed from | 7.4 to | 7.3

EPS FY20E Changed from | 10.4 to | 10.3

Rating Unchanged

Quarterly Performance

Q2FY19 Q2FY18 YoY (%) Q1FY19 QoQ (%)

Revenue 558.6 268.6 108.0 735.5 -24.0

EBITDA 74.6 39.7 88.0 129.4 -42.4

EBITDA (%) 13.4 14.8 -142 bps 17.6 -424 bps

PAT 35.1 16.6 110.9 102.5 -65.8

Key Financials

(| crore) FY17 FY18 FY19E FY20E

Net Sales 1,676.0 1,856.6 2,696.9 3,911.3

EBITDA 221.0 318.8 363.4 527.0

Net Profit 209.7 251.0 186.6 263.7

EPS (|) 8.2 9.8 7.3 10.3

Valuation summary

(x) FY17 FY18 FY19E FY20E

P/E 18.6 15.5 20.9 14.8

Target P/E 23.2 19.4 26.1 18.5

EV / EBITDA 18.1 12.2 11.9 8.8

P/BV 2.5 2.2 2.0 1.8

RoNW (%) 9.7 13.9 9.4 11.9

RoCE (%) 13.2 13.7 11.5 14.2

Stock data

Particular Amount (| crore)

Market Capitalization 3,899.4

Total Debt 335.0

Cash 58.0

EV 4,176.4

52 week H/L (|) 228 / 123

Equity capital 51.3

Face value | 2

Comparative Return Matrix (%)

Return % 1M 3M 6M 12M

Ashoka Buildcon 6.6 (15.4) (32.0) (15.5)

Sadbhav Engg (11.4) (14.6) (17.3) (11.2)

IRB Infra 5.3 (27.3) (45.0) (36.8)

PNC Infratech 8.4 (11.0) (15.3) (20.8)

Research Analyst

Deepak Purswani, CFA

deepak,[email protected]

Harsh Pathak

[email protected]

mailto:[email protected]


Variance Analysis

Particulars Q2FY19 Q2FY19E Q2FY18 YoY (%) Q1FY19 QoQ (%) Comments

Total Operating Income 558.6 603.3 268.6 108.0 735.5 -24.0 Topline growth was led by strong execution during the quarter

Other Income 6.1 17.9 5.2 16.7 17.9 -66.0

Net Raw material consumed 381.3 412.8 176.5 116.0 500.2 -23.8

Employee benefit expenses 42.2 54.3 23.8 77.6 40.6 4.1

Other Expenses 60.5 54.3 28.6 111.7 65.3 -7.4

EBITDA 74.6 81.9 39.7 88.0 129.4 -42.4

EBITDA Margin(%) 13.4 13.6 14.8 -142 bps 17.6 -424 bps Margin contraction on account of higher raw materials in Q2FY19

Depreciation 20.6 19.3 18.4 11.7 19.3 6.8

Interest 15.3 10.7 7.7 99.5 10.7 43.8

PBT 44.8 69.9 18.8 138.4 117.4 -61.9

Taxes 9.7 10.5 2.1 353.1 14.9 NM

PAT 35.1 59.4 16.6 110.9 102.5 -65.8 The growth in bottomline was mainly on account of strong topline

growth

Source: Company, ICICI Direct Research

Change in estimates

FY20E Comments

(| Crore) Old New % Change Old New % Change

Revenue 1,676.0 1,856.6 2,696.9 2,696.9 0.0 3,911.3 3,911.3 0.0 We maintain our estimates

EBITDA 221.0 318.8 366.0 363.4 -0.7 534.8 527.0 -1.5

EBITDA Margin (%) 13.1 17.2 13.6 13.5 -13 bps 13.7 13.5 -23 bps

PAT 151.9 251.0 185.5 186.6 0.6 266.5 263.7 -1.1

Diluted EPS (|) 8.2 9.8 7.2 7.3 0.6 10.4 10.3 -1.1

FY17 FY18 FY19E


Assumptions

EPC FY15 FY16 FY17 FY18 FY19E FY20E FY19E FY20E Comments

Order Inflow 1,832 3,972 5,668 7,750 6,150 4,150 6,150 4,150 We have maintained our estimates

Order Backlog 3,445 5,400 9,392 15,286 18,738 18,977 18,738 18,977

Current Earlier



Conference Call Highlights:

Management guidance & order book: The management has

maintained its revenue guidance of 40-50% to | 2800 crore in

FY19E and also guided for 35% revenue growth in FY20E.

However, it would be reviewing its guidance post Q3FY19E when

several big ticket projects would achieve financial closure. The

order book of the company is at ~| 6100 crore as of Q2FY19, with

an average execution period of two to three years

Bidding pipeline: The management said that NHAI has invited

bids for 70 EPC projects and 30 HAM projects worth | 70,000

crore, with due date expected in the next two to three months.

These bids are inclusive of 1250 km Delhi-Mumbai Expressway

and 1316 km Amritsar-Jamnagar Expressway, which are the

biggest projects of these 100 projects. The management said PNC

will be bidding only for EPC projects considering the tight credit

scenario within the construction sector, which may delay financial

closure of new HAM projects, impacting execution

Appointed date & mobilisation advance: The management

expects the appointed date for the Mumbai Nagpur expressway in

Q3FY19E. Furthermore, it expects mobilisation advance to the

tune of | 600 crore in H2FY19E

Equity requirement: PNC has a total equity requirement of | 782

crore over the next three years. The company is planning to

infuse | 220 crore in FY19E, | 250 crore in FY20E and the balance

in FY21E

Capex & debt: The company has guided for a capex of | 40-50

FY20E. Standalone net debt of PNC Infratech is at | 335 crore as

of Q2FY19 and is expected to at | 400 crore, | 400-500 crore in

FY19E, FY20E, respectively. Standalone D/E for the company is at

0.14 as of Q2FY19

Arbitration award: The company was awarded | 160 crore in the

Narela arbitration case. It has received | 46 crore as of Q2FY19

Land acquisition status: The land acquisition status for several

projects stands as follow: 98-100% for Dausa-Lalsot, 96% for

Chitradurga-Davanagere, 86% for Jhansi-Khajuraho Package 1,

92% for Jhansi-Khajuraho Package 2, 89% for Chakeri-Allahabad,

90% for Aligarh-Kanpur, 80% for Challakere-Hariyur

Toll collections: Toll collections in Q2FY19 for various projects are

as follows: | 17 crore for Kanpur-Kabrai, | 78 crore in Kanpur-

Ayodhya, | 9 crore in Bareilly-Almora and | 51 crore for

Ghaziabad-Aligarh project. The toll collections de-grew YoY for

these projects mainly because of the impact of monsoon on traffic

at the tolls


Company Analysis

Exhibit 1: Key EPC projects under execution…

5.0

10.0

15.0

20.0

25.0

30.0

35.0

FY13 FY14 FY15 FY16 FY17 FY18 FY19E FY20E

(%)

RoE RoCE RoIC

Adjusted RoCE Adjusted RoIC


Exhibit 2: Strong order book, consistent order inflow…

1832 3

972

5668 7750

6150

4150

1530

2017

1676

1857

2697

3911

3445

5400

9392

15286

18738

18977

2.3

2.7

5.6

6.9

4.9

0

5000

10000

15000

20000

FY15 FY16 FY17 FY18 FY19E FY20E

( |

crore)

0.0

2.0

4.0

6.0

8.0

(x)

Orderinflow Revenue Closing orderbook Orderbook to bill (x)


Exhibit 3: Net working capital days & debt-equity trend…

110

98

98

109

131

113

113

112

0.5

0.3

0.3

0.4 0.4

0.0

0.10.1

70

90

110

130


(days)

-0.1

0.1

0.3

0.5

0.7

(x)

Net Working Capital days Debt-Equity



Exhibit 4: BOT project summary

Project % Stake Authority State Stretch Type Kms Lanes

Equity invested

(| crore)

PNC's share of invested

equity (| crore)

Debt outstanding

(| crore)

Ghaziabad Aligarh 35 NHAI UP NH-91 Toll 125.0 4 194.0 67.9 1136.0

Kanpur Kabrai 100 NHAI UP NH-86 Toll 123.0 2 67.5 67.5 209.0

Gwalior Bhind 100 MPRDC MP NH-92 Toll 107.7 2 78.3 78.3 197.0

Bareilly Almora* 100 UPSHA UP SH-37 Toll 54.0 4 74.6 74.6 443.0

Rae Bareli Jaunpur* 100 NHAI UP NH-23 Annuity 166.4 2 139.6 139.6 631.0

Narela Industrial Estate 100 DSIIDC Delhi NA Annuity 33.0 NA 35.0 35.0 83.0

Kanpur Ayodhya 100 NHAI UP NH-28 OMT 217.0 4 0.1 0.1 -

Total 826.1 589.1 463.0 2699.0


*Bareilly Almora commenced its operation in October, 2015

Exhibit 5: HAM project summary

Project % Stake Authority State/Stretch Stretch Type Kms Lanes

Total Project cost (|

crore)

PNC's share of invested

equity (| crore)

Dausa-Lalsot 100 NHAI Rajasthan NH-11A Hybrid 83.5 4 820.0 46.0

Chitradurga–Davanagere^ 100 NHAI Karnataka NH-48 Hybrid 72.7 6 1338.0 55.0

Jhansi-Khajuraho (Package I) ^ 100 NHAI UP & MP NH-75/76 Hybrid 76.3 4 1342.0 5.0

Jhansi-Khajuraho (Package II) ^ 100 NHAI UP & MP NH-75/76 Hybrid 85.4 4 1262.0 43.0

Chakeri-Allahabad ** 100 NHAI UP NH-2 Hybrid 145.1 6 2018.0 0.3

Aligarh Kanpur*** 100 NHAI UP NH-91 Hybrid 45.0 4 1104.0 0.3

Challakere - Hariyur** 100 NHAI Karnataka NH-150 A Hybrid 55.7 4 1013.0 0.0

Total 563.7 8897.0 149.5


^Financial Closure Achieved; * Bid Project Cost; **LOI Received ***SPV formed

Exhibit 6: Revenue growth momentum to continue…

1992.1

1676.0

1856.6

2696.9

3911.3

0.0

1000.0

2000.0

3000.0

4000.0

5000.0

FY16 FY17 FY18 FY19E FY20E

(|

crore)

45.1% CAGR


We expect revenues to witness robust growth of 45.1%

CAGR to | 3911.3 crore in FY18-20E with a pick-up in

execution


Exhibit 7: EBITDA & EBITDA margin trend…

153.5

155.8

141.9

216.6

265.9

221.0

318.8

363.4

527.0

0.0

100.0

200.0

300.0

400.0

500.0

600.0

FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19E FY20E

(|

crore)

8.0

10.0

12.0

14.0

16.0

(%

)

EBITDA EBITDA Margin

28.6%


Exhibit 8: PAT growth trend…

100.4

154.0

151.9

251.0

186.6

263.7

50.0

100.0

150.0

200.0

250.0

300.0

FY15 FY16 FY17 FY18 FY19E FY20E

(|

crore)

5.0%

7.0%

9.0%

11.0%

13.0%

(%

)

PAT PAT Margin(%)


Exhibit 9: Return ratios trend…

5.0

10.0

15.0

20.0

25.0

30.0

35.0


(%

)

RoE RoCE RoIC

Adjusted RoCE Adjusted RoIC


We expect the EBITDA margin to improve to 13.7% in

FY20E


Outlook and Valuation

PNC’s robust order book, strong execution capabilities and lean balance

sheet with better WC management reinforce our confidence on the future

prospects of the company. Also, we believe PNC is well poised to capture

huge opportunities ahead. We expect revenues to grow at a CAGR of

45.1% in FY18-20E given the significant ramp-up in execution from FY19E

onwards with receipt of appointed dates for several big-ticket projects.

Hence, we maintain our BUY rating on the stock with a target price of |

190. We value its construction business at | 164/share (at 8x FY20E

EV/EBITDA) and BOT & HAM projects at | 53/share (traffic growth

assumption - 5% per annum).

Exhibit 10: SoTP valuation

Entity Value (| crore) Per share (|) Comment

Construction Business 4,216 164 8x FY20 EV/EBITDA

BOT Projects 1,360 53

Ghaziabad Aligarh 116 5

Bareilly Almora 79 3

Gwalior Bhind 192 8

Raibereli Jaunpur 89 3

Narela Industrial Area 150 6

Kanpur Kabrai 234 9

New Projects 500 19

Less:Net Debt 720 28 FY20E net debt

Target Price 4,856 189

Rounded off target price 190


EPC business: We value PNC’s EPC business at | 164/share (at 8x FY20E

EV/EBITDA) considering its reputation of timely/early completion, strength

in balance sheet and better return profile.

BOT projects: We value PNC’s BOT project portfolio on a free cash flow to

equity (FCFE) basis. To value it, we consider a traffic growth rate of 5%

per annum (except Ghaziabad Aligarh project where we have considered

a nil growth in FY18E traffic due to a sharp hike in toll rate following full

CoD) and then 5% per annum). We also consider the cost of equity of

13% for toll based projects and 12% for annuity projects. Based on these

assumptions, we value PNC’s BOT portfolio at | 53/share.

We value its construction business at | 164/share (at 8x

FY20E EV/EBITDA) and BOT & HAM projects at |

53/share (traffic growth assumption – 5% per annum)

We consider traffic growth assumption of 5% per

annum and CoE of 12% for annuity and 13% for toll

based projects


Financial Summary

Recommendation history vs. Consensus

0

75

150

225

300

Nov-18Aug-18May-18Feb-18Nov-17Sep-17Jun-17Mar-17Dec-16Sep-16Jun-16Mar-16Dec-15Sep-15

(|

)

0.0

25.0

50.0

75.0

100.0

125.0

(%

)

Price Idirect target Consensus Target Mean % Consensus with BUY

Source: Bloomberg, Company, ICICI Direct Research

Key events

[

Date Event

Mar-16 PNC Infratech declared L1 bidder for 4-laning of Varanasi-Gorakhpur section of NH-29 from 12 to 88 km (Package II from Sandah to Birnon) in Uttar Pradesh under

NHDP Phase-IV . The contract is worth ~| 869 crore and is to be executed on EPC basis.

Mar-16 PNC Infratech achieves CoD of Raebareli-Jaunpur BOT project and is entitled to receive semi annual annuity of | 64.3 crores each during the remaining 15 years of

the concession period

Mar-16 Receives letter of acceptance (LoA) for the project of construction of three lane road on both sides of Sharda Sahayak Feeder Canal from Lucknow-Faizabad to

Lucknow-Sultanpur road worth | 205.7 crore in UP

Mar-16 Declared lowest bidder for project of four laning of Nagina-Kashipur section of NH-74 from 73 to 175 km in the states of Uttarakhand and UP under NHDP IV. The

contract amount for this NHAI project to be executed on EPC basis is | 1155.7 crore

Apr-16 Declared L1 (lowest) bidder for upgradation of Nanau-Dodon section in Aligarh district, UP worth | 119.9 crore

Apr-16 CARE upgrades credit ratings on long term bank facilities (senior debt) to CARE A- from CARE BBB and subordinate debt to CARE BBB+ from CARE BBB- of PNC

Raibareli Highways Pvt Ltd, a subsidiary of PNC Infratech

May-16 PNC Infratech declared L1 (lowest) bidder for extension and resurfacing of runway at Air Force Station, Bakshi Ka Talab, near

Lucknow. The bid amount for this project of Military Engineering Services, is | 140.6 crores.

Jul-16 PNC Infratech declared lowest bidder for ₹ 881 crore highway project under Hybrid annuity mode. The project entails four-laning and two-laning of the Dausa-Lalsot-

Kautham section (83.5 km) of National Highway 11A in Rajasthan.

Jul-16 PNC Infratech awarded an EPC project involving four laning of the Etah to Kasganj road in Uttar Pradesh for a contract value of | 232.9 crore


Top 10 Shareholders Shareholding Pattern

Rank Name Latest Filing Date % O/S Position (m) Change (m)

1 NCJ Infrastructural Consultants Pvt. Ltd. 2-Jul-18 9.7% 24.8 -1.9

2 Jain (Yogesh Kumar) 30-Jun-18 8.5% 21.9 0.0

3 HDFC Asset Management Co., Ltd. 31-Aug-18 8.2% 21.1 -0.6

4 Jain (Pradeep Kumar) 30-Jun-18 8.0% 20.6 0.0

5 Jain (Navin Kumar) 30-Jun-18 7.1% 18.1 0.0

6 Jain (Madhavi) 30-Jun-18 7.0% 18.0 0.0

7 Jain (Vaibhav) 30-Jun-18 4.5% 11.7 0.0

8 ICICI Prudential Asset Management Co. Ltd. 31-Aug-18 4.0% 10.3 0.1

9 Jain (Chakresh Kumar) HUF 30-Jun-18 3.6% 9.3 0.0

10 Jain (Ashita) 30-Jun-18 3.1% 7.9 0.0[

(in %) Dec-17 Mar-18 Jun-18 Sep-18

Promoter 56.1 56.1 56.1 56.1

Public 43.9 43.9 43.9 43.9

Others 0.0 0.0 0.0 0.0

Total 100.0 100.0 100.0 100.0

Source: Reuters, ICICI Direct Research

Recent Activity

Investor name Value Shares Investor name Value Shares

Daiwa Asset Management (Singapore) Ltd. 0.6 0.3 Pppl Constructions Pvt. Ltd. -55.3 -23.9

IDFC Asset Management Company Private Limited 0.3 0.2 NCJ Infrastructural Consultants Pvt. Ltd. -4.4 -1.9

ICICI Prudential Asset Management Co. Ltd. 0.1 0.1 HDFC Asset Management Co., Ltd. -1.3 -0.6

DHFL Pramerica Asset Managers Private Limited 0.1 0.1 SBI Funds Management Pvt. Ltd. -0.8 -0.5

Affin Hwang Asset Management Berhad 0.0 0.0 Aditya Birla Sun Life AMC Limited -0.7 -0.3

Buys Sells

Source: Reuters, ICICI Direct Research


Exhibit 11: Profit & Loss Statement

(Year-end March) FY17 FY18 FY19E FY20E

Net Sales 1,676.0 1,856.6 2,696.9 3,911.3

Other operating income 13.2 - - -

Other income 46.6 23.0 8.7 4.0

Total Revenues 1,735.7 1,879.6 2,705.6 3,915.3

Raw Material Expense 1,161.8 1,218.2 1,869.3 2,711.1

(Increase)/decrease in inventories of WIP 24.8 6.0 8.8 12.7

Employee benefit expenses 100.3 124.0 180.1 261.2

Other Expenses 181.2 189.6 275.4 399.3

Total Operating Expenditure 1,468.1 1,537.8 2,333.5 3,384.3

EBITDA 221.0 318.8 363.4 527.0

Interest 20.3 30.7 48.3 69.5

Depreciation 53.3 77.2 87.5 109.9

PBT 193.9 233.9 236.3 351.6

Total Tax (15.8) (17.1) 49.6 87.9

Reported PAT 209.7 251.0 186.6 263.7

Adjusted PAT 151.9 251.0 186.6 263.7

EPS (Diluted) 8.2 9.8 7.3 10.3


Exhibit 12: Cash Flow Statement


Profit after Tax 209.7 251.0 186.6 263.7

Depreciation 53.3 77.2 87.5 109.9

Interest Paid (46.6) (23.0) (8.7) (4.0)

Cash Flow before WC changes 221.0 318.8 363.4 527.0

Net Increase in Current Assets (162.5) (154.2) (640.7) (920.9)

Net Increase in Current Liabilities 157.9 177.0 385.2 556.7

Net CF from Operating Activities 232.2 358.7 58.3 74.9

(Purchase)/Sale of Fixed Assets (13.5) (128.0) (225.0) (50.0)

Purchase of Investment (264.2) (64.9) (225.0) (225.0)

Interest Income 46.6 23.0 8.7 4.0

Net CF from Investing Activities (231.1) (169.9) (441.3) (271.0)

Proceeds from share capital - - - -

Interest Paid (20.3) (30.7) (48.3) (69.5)

Net CF from Financing Activities 96.0 (72.6) 306.0 156.2

Net Cash flow 97.1 116.2 (77.1) (39.8)

Opening Cash/ Cash Equivalent 97.1 35.5 147.3 70.2

Closing Cash/ Cash Equivalent 35.5 147.3 70.2 30.4


Exhibit 13: Balance Sheet


Liabilities

Share Capital 51.3 51.3 51.3 51.3

Reserves & Surplus 1,520.9 1,755.4 1,924.8 2,164.2

Total Shareholders funds 1,572.2 1,806.7 1,976.1 2,215.5

Secured Loan 147.3 128.6 500.0 750.0

Unsecured Loan - - - -

Total Debt 147.3 128.6 500.0 750.0

Deferred Tax Liability - - - -

Liability side total 1,719.5 1,935.1 2,476.1 2,965.4

Assets

Gross Block 442.4 570.5 795.5 845.5

Net Block 345.9 404.8 542.3 482.4

Capital WIP 7.8 11.1 11.1 11.1

Non-current Investments 728.5 793.4 1,018.4 1,243.4

Current Assets

Inventories 153.5 175.8 258.6 375.1

Sundry Debtors 630.9 690.0 1,004.9 1,446.6

Loans and Advances 364.2 412.7 591.1 857.3

Other Current Assets 125.4 149.7 214.3 310.8

Cash 35.5 147.3 70.2 30.4

Total Current Assets 1,309.5 1,575.4 2,139.1 3,020.1

Creditors 236.9 462.8 672.3 975.1

Provisions 24.1 17.6 25.5 37.0

Other Current Liabilities 249.2 205.6 298.7 433.1

Other Long Term Liabilities 164.0 165.2 239.9 348.0

Total Current Liabilities 674.2 851.2 1,236.4 1,793.1

Net Current Assets 635.3 724.3 902.7 1,227.0

Assets side total 1,719.5 1,935.2 2,476.1 2,965.5


Exhibit 14: Key Ratios


Per Share Data

EPS (Fully Diluted) 8.2 9.8 7.3 10.3

Cash EPS 10.3 12.8 10.7 14.6

BV 61.3 70.4 77.0 86.4

Dividend per share 0.8 0.9 0.7 0.9

Operating Ratios

EBITDA / Net Sales 13.2 17.2 13.5 13.5

PAT / Net Sales 9.1 13.5 6.9 6.7

Inventory Days 33 35 35.0 35.0

Debtor Days 137 136 136.0 135.0

Creditor Days 52 91 91.0 91.0

Return Ratios

RoE 9.7 13.9 9.4 11.9

RoCE 13.2 13.7 11.5 14.2

RoIC 10.0 13.6 11.5 14.3

Valuation Ratios

EV / EBITDA 18.1 12.2 11.9 8.8

P/E 18.6 15.5 20.9 14.8

EV / Net Sales 2.4 2.1 1.6 1.2

Market Cap / Sales 2.3 2.1 1.4 1.0

Price to Book Value 2.5 2.2 2.0 1.8

Turnover Ratios

Asset turnover 1.0 1.0 1.1 1.3

Gross Block Turnover 3.8 3.2 3.4 4.6

Solvency Ratios

Debt / Equity 0.1 0.1 0.3 0.3

Current Ratio 1.9 1.7 1.7 1.7

Debt / EBITDA 0.7 0.4 1.4 1.4

Quick Ratio 1.7 1.5 1.5 1.5



ICICI Direct Research Universe (Construction & Infrastructure)

CMP M Cap

(|) TP(|) Rating (| Cr) FY17 FY18E FY19E FY17 FY18E FY19E FY17 FY18E FY19E FY17 FY18E FY19E FY17 FY18E FY19E

IRB Infra (IRBINF) 208 230 Hold 7,281 19.1 21.5 27.7 10.9 9.7 7.5 1.3 1.2 1.2 1.4 1.3 1.1 13.2 13.6 15.2

PNC Infratech (PNCINF) 168 215 Buy 4,310 8.2 9.8 7.2 20.6 17.2 23.2 20.0 13.6 12.8 2.7 2.4 2.2 9.7 13.9 9.4

Sadbhav Engg. (SADENG) 271 430 Buy 4,655 10.9 12.9 17.1 24.8 21.1 15.8 17.3 14.7 12.0 2.8 2.5 2.2 11.3 11.8 13.8

Ashoka Buildcon (ASHBUI) 146 195 Buy 2,749 -7.9 -4.2 0.9 NA NA 191.7 9.6 8.1 7.2 9.9 14.7 13.6 NM NM 7.1


Sector / Company

RoE (%)EPS (|) P/E (x) EV/EBITDA (x) P/B (x)


RATING RATIONALE

ICICI Direct Research endeavours to provide objective opinions and recommendations. ICICI Direct Research

assigns ratings to its stocks according to their notional target price vs. current market price and then

categorises them as Strong Buy, Buy, Hold and Sell. The performance horizon is two years unless specified and

the notional target price is defined as the analysts' valuation for a stock.

Strong Buy: >15%/20% for large caps/midcaps, respectively, with high conviction;

Buy: >10%/15% for large caps/midcaps, respectively;

Hold: Up to +/-10%;

Sell: -10% or more;

Pankaj Pandey Head – Research [email protected]

ICICI Direct Research,

ICICI Securities Limited,

1st Floor, Akruti Trade Centre,

Road No 7, MIDC,

Andheri (East)

Mumbai – 400 093

[email protected]


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research report accurately reflect our views about the subject issuer(s) or securities. We also certify that no part of our compensation was, is, or will be directly or indirectly related to the specific

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