With a market capitalization of Rs 2,161 crores, the shares of Ashoka Buildcon Limited currently trades at Rs 77, approximately 1.50 percent up as compared to the previous closing price of Rs 75.85. In the last one-month period, the stock has slipped around 10.50 percent ranging from Rs 85.95 to the current price levels.
The company, last week, announced its Q4 as well as Annual results for FY2022-2023. Details pertaining to the same are been discussed later on in the report.
Ashoka Buildcon Limited is engaged in the development of highways and is also active when it comes to power transmission & distribution. The company conducts operations of its business across India. The majority of its revenue is generated from construction and contract-related activities.
Looking at the consolidated QoQ numbers reported by the company, the operating revenues increased from Rs 1,956 crores in Q3 to Rs 2,448 crores in Q4. On a contrasting note, the net profit figures, during the same time horizon, moved down from Rs 138 crores to Rs 34 crores representing a decrease of 75 percent.
In congruence with the pattern shown by the above-mentioned metrics, the YoY numbers exhibit the operating revenues increasing from Rs 5,999 crores during FY21-22 to Rs 8,100 crores in FY22-23 and net profits took a shift down from Rs 771 crores to Rs 373 crores showing a reduction of 52 percent.
Having a positive outlook for the company, HDFC Securities gave a ‘Buy’ recommendation for the stock with a target price of Rs 135 indicating an upside of about 75 percent as compared to the current price levels.
The rationale behind providing such a recommendation on the stock is the visibility of revenues due to the well-diversified order book of the company, etc.
As per the latest data available for the March 2023 quarter, Promoters of the company hold a 54.48 percent stake, and Foreign Institutional Investors (FIIs) hold a 1.9 percent stake in the company.
Written by Amit Madnani
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