NBCC India: A Multibagger Stock with a Strong Order Book and Real Estate Monetisation Opportunities
NBCC India has proposed a three-phase construction plan to complete 50,000 Supertech apartments across 17 projects over the next three years. The company is also executing the Amrapali project, which is expected to be completed by end-FY25.
Nbcc IndiaSupertechAmrapali ProjectReal Estate MonetisationNavratna PsuReal EstateSep 10, 2024
The company has also been entrusted with the responsibility of developing a township worth Rs 15,000 crore in Srinagar. According to Nuvama Institutional Equities, an improvement in order intake, execution, and margins along with traction in real estate monetisation bode well for the company.
The domestic brokerage has retained its 'Hold' rating on the multibagger stock with an unchanged target price of Rs 198. The stock is up 114 per cent year-to-date and 190 per cent in the past one year. Nuvama's target on NBCC India suggests a 13 per cent potential upside over the prevailing market price.
The company is well placed for growth, with a robust order book of Rs 81,300 crore and book-to-bill of 7.6 times. It has a strong order accretion with year-to-date order wins at Rs 19,800 crore against Rs 23,500 crore in FY24. The real estate monetisation at the Nauroji Nagar project has been at Rs 13,400 crore against an expected realisation of Rs 12,500 crore.
A buoyant realty cycle is resulting in improved opportunities for the company, with many PSUs/government looking to monetise surplus land holdings. The Amrapali project contributed Rs 370 crore to revenue in Q1FY25 against Rs 1,800 crore in FY24. Overall, 84 per cent of the work has been completed on the project, with Rs 7,100 crore execution till June 2024.
The company has sold 6,300 units in this project for Rs 3,650 crore. NBCC has also been awarded another Rs 10,000 crore work order in the Amrapali project by way of additional FAR, which entails construction of 7,500 new units.
In Netaji Nagar, work on projects worth Rs 1,400 crore is underway, while two tenders of Rs 1,700 crore are in the pipeline. Works worth Rs 6,600 crore across 10 phases are going on in Sarojini Nagar. The company expects to receive operational certificate soon after which it would proceed for bulk sale.
NBCC has already sold Rs 1,300 crore to date in this project. The central government plans to approve commercialisation of 45 acres of land in Delhi (to be undertaken by NBCC) in order to raise Rs 20,000 crore to fund the ongoing redevelopment of seven government colonies.
About NBCC (India) Ltd
NBCC (India) Ltd is a Navratna PSU that provides project management consultancy services to real estate, infrastructure, and construction projects. The company has a strong track record of turning around stalled housing projects and has a robust order book of Rs 81,300 crore.
Frequently Asked Questions
What is the status of the Amrapali project?
The Amrapali project is going on in full swing and is expected to be completed by end-FY25.
What is the target price of NBCC India set by Nuvama Institutional Equities?
The target price of NBCC India set by Nuvama Institutional Equities is Rs 198.
What is the current market price of NBCC India?
The current market price of NBCC India is Rs 175.25 on BSE.
What is the order book of NBCC India?
The order book of NBCC India is Rs 81,300 crore.
What is the book-to-bill ratio of NBCC India?
The book-to-bill ratio of NBCC India is 7.6 times.
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