Anand Rathi has given Buy recommendation for PNC Infratech with a target price of Rs. 311 in its research report issued on Feb 06, 2021
Anand Rathi’s research report on PNC Infratech
With strong non-road orders recently added, PNC’s order backlog is now well diversified (and de-risked). To a large extent, it also addresses growth issues that the ensuing scale could have posed were it to have remained within a single segment. The not-so-capital intensive nonroad orders added, mostly in its home state, imply the approach is calibrated, and management is confident of retaining its blended returns profile. On the brighter growth prospects (due to a widened opportunity landscape), a further strengthened net cash status and the general contraction in cost of capital, we raise the EPC PE multiple to 12x (from 9x earlier), and roll forward to FY23e.
Hence, we retain a Buy rating with a higher TP of Rs311 (Rs210 earlier).