Shares of this infrastructure stock surged by more than 6 percent to Rs.1,598 per share after bagging an order of Rs.716 crore from Central Railways for the construction of a new broad gauge line.
Share Price Movement
In Friday’s trading session, H.G. Infra Engineering Ltd’s (HGIEL) share price surged 6.4 percent to an intraday high of Rs.1,598 per share, up from its previous close of Rs.1,502.3 apiece. The price has since retreated and is currently trading at Rs.1,582.5 per share.
Rationale for the Rise
H.G. Infra Engineering Limited has received an order from Central Railway for the construction of a new broad gauge line between Dhule (Borvihir) and Nardana, spanning approximately 49.45 km.
The project, awarded on an Engineering & Procurement (EPC) basis, is valued at Rs.716.11 crore, with a 30-month construction period and an appointed date of September 4, 2024.
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Order Book
As of June 2024, H.G. Infra Engineering Limited’s total order book stands at Rs.15,641.8 crore. Of this, Rs.11,452.3 crore is allocated to roads and highways, Rs.2,498 crore to railways and metro projects, and Rs.1,691.5 crore to solar projects.
Domestic Presence
H.G. Infra Engineering Limited is involved in constructing roads and highways in Odisha, Telangana, Rajasthan, Delhi, Andhra Pradesh, Haryana, and Uttar Pradesh. The company is accredited AA class by the Public Works Department of the Government of Rajasthan and holds an SS class contractor registration with the Military Engineer Services.
Revenue Breakup
The company’s revenue is split between 9 percent from private clients and 91 percent from government projects. The revenue breakdown includes 73 percent from highways, 16 percent from railways, and 11 percent from solar projects.
In terms of project models, 72 percent of revenue comes from the Hybrid Annuity Model (HAM), while 28 percent is derived from Engineering, Procurement, and Construction (EPC) contracts.
Financials
For the quarter ended June 2024, H.G. Infra Engineering Limited reported a net profit of Rs.163 crore, up 8.7 percent from Rs.150 crore in Q1 FY24. Revenue from operations was Rs.1,528 crore, rising 13 percent from Rs.1,351 crore in the same period.
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About the company
H.G. Infra Engineering Limited (HGIEL) is an infrastructure construction firm focused primarily on executing highway, road, and bridge projects using Engineering, Procurement, and Construction and Hybrid Annuity Modelapproaches.
Written by – Siddesh S Raskar
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