Ashoka Buildcon on a running spree! Stock surged nearly 20% so far

2 Jun 2022 , 03:09 PM

Ashoka Buildcon Limited, one of the Key Infra players, has cheered investors with handsome returns as the stock jumped over 19% in the last week. Analysts anticipate further upside in this stock.

The company posted robust growth in its Q4 revenue from operations registering a growth of 12% yoy at Rs1,560 crore, with a sequential growth of 41%. The company’s PAT clocked a growth of 26% yoy on the back of higher income and tax write back. While EBITDA was reported at Rs160 crore, registering a decline of 22% yoy. Sequentially, it jumped 30% and missed the estimates.

The company has a strong balance sheet and is ready to turn better on account of recently proposed arrangements to monetize five BOT (built operate and transfer) toll assets and a BOT annuity.

The management anticipates 20-25% growth in the topline, combined with strong inflows of Rs1,000 crore.

The announcement of the KKR Deal has also removed a big overhang from the stock. However, significant changes could be witnessed once the deal takes place.

Over the last few years, the company has witnessed strong growth in revenue with a yearly rate of about 12%, while the industry average was just 4.48%. In the meantime, the Company also managed to increase its market share from 1.12% to 1.76%.

Overall, the stock has underperformed the benchmark and declined 14.2% over the last six months.

Brokerages have retained a ‘Buy’ rating for the counter on the back of a well-set balance sheet and strategic asset monetization. Further, it anticipates an upside of 80% from current levels.

At around 3.15 PM, Ashoka Buildcon was trading at Rs81.50 down by Rs0.05 or 0.06% from its previous closing of Rs81.55 on the BSE.