The shares of one of the leading infrastructure and construction firm gained 5 percent to an intraday high of ₹71.50 per share on Monday after the company received a contract worth of ₹525 crores from the Government of Telangana.
At 12:15 p.m., Patel Engineering Ltd. shares were trading at ₹69.34 per share, up 1.85 percent from the previous close price on the National Stock Exchange. The stock belongs to the small-cap category, with a market capitalization of ₹5,360 crores.
According to the company’s exchange filing,. Patel Engineering Limited (PEL) received a Letter of Acceptance (LOA) from the Irrigation & CAD Department, Government of Telangana, in collaboration with its joint venture partner, for a contract valued at ₹525.36 crore. Patel Engineering’s share in the contract is ₹. 267.93 crore.
This agreement involves the building of a protective Wall made of Reinforced cement concrete (RCC), extending 8.5 kilometers on both the right and left sides of the Munneru River. The project spans from Polepally to Prakashnagar in Khammam City, situated in the Khammam District.
Furthermore, the contract encompasses the construction of embankments, each spanning 2 kilometers, on both sides of the Munneru River near the Nagarjuna Sagar Left Bank Aqueduct in Khammam City.
Additionally, the company witnessed an 11% growth in its year-on-year revenue, climbing from ₹955 crore in the third quarter of fiscal year 2023 to ₹1,061 crore in the third quarter of fiscal year 2024. Simultaneously, the net profit surged by 187%, escalating from ₹24 crore to ₹69 crore during the same period.
Patel Engineering Ltd is engaged in the construction of dams, bridges, tunnels, and other kinds of heavy civil engineering works in areas like hydro, irrigation, and urban infrastructure. The company has a domestic presence across 17 Indian states and an international presence in Nepal.
As of the december quarter,Kedia Securities holds 1,30,00,000 equity shares which is equivalent to a 1.68 percent stake in the company.
As of the last quarter in December, the company possesses an order backlog totaling ₹1,91,347 million. The distribution of orders is as follows: 61.09 percent originates from Hydroelectric projects, 21.01 percent from Irrigation projects, 11.06 percent from tunnel projects, and 2.98 percent from road projects.
Breaking down the overall order book, the majority of orders, specifically 61.94 percent, are sourced from Central Government and Public Sector Undertakings (PSUs), followed by 34.75 percent from State Government Departments, and 3.31 percent from international orders.
Patel Engineering Ltd. shares gained 25 percent in the last six months and a multibagger return of 352 percent in a year. For example, a shareholder investment of ₹1 lakh in the company, would be worth ₹4.52 lakhs in a year.
Written by Omkar Chitnis
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