This smallcap multibagger PSU stock is down 18% from its all-time high: Check details

Shares of NBCC (India), a Navratna PSU, under the Ministry of Housing and Urban Affairs are down over 18 per cent from their all-time high of Rs 176.5 marked on February 5, 2024. At the last count, shares traded lower by nearly 2 per cent at Rs 145.8 per share on the BSE.

The company operates across various segments, including PMC (Project Management Consultancy), EPC (Engineering, Procurement, and Construction), and Real Estate. This diversification helps mitigate risks and provides multiple growth avenues. 

In the last 9 months, the company has secured new orders worth Rs 10,000 crore, as against Rs 6500 crore in the previous year. This robust order book growth is a testament to the company's strong execution capabilities and provides revenue visibility for the future, notes Vaibhav Vidwani- Research Analyst- Bonanza Portfolio.

Strong order book outlook 

Vidwani further highlighted that the company is standing at an outstanding consolidated order book of Rs.55,300 Cr and expecting orders more than Rs 20,000 in FY25E which will be supported by:

 a) NBCC is actively pursuing redevelopment projects, including the 7 GPRA (General Pool Residential Accommodation) project and opportunities in the PSU land bank. These projects offer significant revenue potential and provide a steady stream of income. 

b) With the government's push towards affordable housing for the middle-class income group, NBCC is well positioned to capitalize on this opportunity. The company is actively assessing and engaging with various government agencies and state governments. 

c) NBCC has established a foothold in overseas markets, particularly in African countries, Maldives, and Mauritius.

Exploring further expansion internationally

In addition, the company is actively exploring opportunities in the Gulf region, including Saudi Arabia, Bahrain, and Sharjah, where there is a significant demand for housing projects.

NBCC’s shareholding pattern

While a significant stake to the tune of 61.75 per cent is held by the central government, LIC and CPSE ETF also has an ownership in the stock. Nevertheless, FIIs have decreased their bet on the counter to 4.33 per cent in the March ended quarter as against 4.46 per cent in the preceding quarter.

Analysts' view on NBCC

Stock research platform Trendlyne’s data suggest that there is a consensus recommendation of a ‘strong sell’ on the counter from 4 analysts. The stock has an average target of Rs 122 and the consensus estimate represents a downside of around 16 per cent from the last traded price. It can be noted that the stock over the last one year has given multibagger return to the tune of 262 per cent.