Anand Rathi has given Buy recommendation for Ashoka Buildcon with a target price of Rs. 147 in its research report issued on Nov 23, 2021

Anand Rathi’s research report on Ashoka Buildcon

The recent well-diversified sturdy order additions is an augury, but delayed commencing of construction at some of the recently added orders meant Ashoka’s Q2 pace of execution was slightly soft. Nevertheless, with six of its recently added orders set to turn contributing shortly, management targets ~20% y/y higher FY22 revenues. The standalone balance-sheet strength is intact. Covid-19 has likely delayed asset monetisation, but efforts are still underway, and the recent renegotiation of terms with the partner suggests efforts are progressing. Proven execution capabilities, a well-set balance sheet and benign valuations impel us to retain our Buy rating.


On accounting for the recent sharp surge in key commodities, our margin estimates have been pruned, but earnings, owing to the pruned capex and higher other income, are still ~1% better for FY22 and FY23 each. On our newly introduced FY24e, the stock (excl. investments) is available at 5.4x FY24e core construction EPS.

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