Nagarjuna Construction Company (NCC) - Q3FY13 Result Update - Kotak

Result highlights: Revenues of the company were lower than our estimates and operating margins also came lower than our expectations and also lower than management guidance. Though profitability improved on yearly basis but continues to remain impacted by high interest outgo.

We tweak our estimates and maintain ACCUMULATE rating on the stock and would advise investors to use declines in the stock to buy with a one year view.

At current price, stock is trading at 16.4x and 13.2x P/E and 7.5x and 7.1x EV/EBITDA on FY13 and FY14 respectively. Adjusted with valuation of its BOT assets, stock is trading at 6.6x and 5.3 x P/E on FY13 and FY14 respectively. We tweak our estimates and continue to maintain ACCUMULATE rating on the stock with a revised price target of Rs 45 (earlier Rs47).

Source : Equity Bulls

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