This Infra Company’s Order Book Value is 2.5x Market Cap, Reports 4.7 per cent Expansion in EBITDA Margin in Q3

The company reports sequential growth in revenue and EBITDA, but YoY performance declined due to challenging market conditions

PNC Infratech, a leading infrastructure company, announced its Q3FY25 financial results, showcasing a mixed performance. While the company reported sequential growth in revenue and EBITDA, it experienced a year-on-year decline due to challenging macroeconomic conditions.

For the quarter, PNC Infratech’s revenue stood at Rs 1,470 crore, marking a 28.1 per cent YoY decline from Rs 2,047 crore in Q3FY24. Net profit dropped by 48.1 per cent YoY to Rs 81 crore, impacted by cost pressures and execution delays. However, the EBITDA margin expanded by 4.7 per cent YoY, improving from 21.1 per cent to 25.8 per cent, reflecting cost optimizations and better project execution. On a QoQ basis, operating profit grew 6.46 per cent to Rs 379 crore, showing resilience amid market headwinds.

Despite a 56 per cent YoY decline in net profit, the company’s sequential EBITDA growth and strong order book suggest a promising future. The company also actively pursues asset monetization to free up capital for growth initiatives.

Operational Updates and Market Positioning

• Order Book Strength: Rs 18,900 crore as of December 31, 2024, 2.5x of the current market capitalization of Rs 7,365 crore.
• Diversification: Presence in EPC, BOT, OMT, and HAM projects ensures a balanced risk-reward approach.
• Asset Monetization: Strengthening financials by unlocking capital for new projects.
• Strategic Relief: MoRTH has reduced PNC Infra’s disqualification period from tendering, allowing fresh participation in new government projects from February 2025.

While PNC Infratech faces macroeconomic challenges, inflationary pressures, and a high-interest rate environment, the company actively manages risks through strategic asset monetization, operational efficiency, and project diversification. The strong order book and recent bidding clearance from MoRTH are positive indicators of future growth.

As of February 11, 2025, PNC Infratech shares traded at Rs 287, with a TTM P/E of 6.5x. Its order book-to-market cap ratio of 2.5x indicates a growth potential.

Disclaimer: This article is for informational purposes only and should not be construed as investment advice.