NBCC India shares jump 11% on securing ₹15K cr township contract

NBCC India shares surged 11% on the NSE today after the state-owned company secured contract worth 15,000 crore from the Srinagar Development Authority. As part of the contract, the company, that comes under the Ministry of Housing and Urban Affairs, will develop a 406-acre Satellite Township at Rakh-e-Gund Akshah in Bemina, Srinagar.

Early today, the realty stock opened at ₹170.48 and surged to an intraday high of ₹188.40. Currently, the share was trading at ₹182.80, up 8.12% against yesterday’s closing level of ₹169.07. Since last year, the stock has surged 276% and is up 125% year-to-date.

The latest order is equivalent to 0.45 times the company's current market capitalisation of ₹33,035.40 crore.

A memorandum of understanding was recently signed between Owais Ahmed, Vice Chairman of the SDA, and Sanjay Gupta, Executive Director of NBCC, in the presence of Mandeep Kaur, Commissioner Secretary of the Housing & Urban Development Department, and Ravi Arora, Joint Secretary of MOHUA.

The Navratna enterprise will serve as the project management and marketing consultant, overseeing the project’s execution from concept to commissioning in a phased approach. Approved in 2022, this project is part of the Srinagar Development Authority's initiative to transform Srinagar into a smart city, encompassing numerous urban development projects.

At the beginning of this month, the company received another Srinagar order of ₹50 crore from the Ministry of External Affairs for a regional passport office construction in the J&K capital.

The company has significantly expanded its order book, in recent weeks with several new contracts. On July 30, its subsidiary, Hindustan Steelworks Construction Limited (HSCL), was awarded a ₹443.61 crore contract by the Government of Maharashtra for the construction of a new Government Medical College in Parbhani as well as a Residential Doctors & Interns Hostel Building in Solapur. Another subsidiary, HSCC India, received another ₹411.45 crore contract from the Maharashtra government for a government medical college construction in Buldhana.

NBCC India, previously known as National Buildings Construction Corporation Limited, operates across three key segments - Project Management Consultancy (PMC) contributes approximately 93% to its business, Engineering Procurement & Construction (EPC) contracting accounts for 4%, and Real Estate (RE) makes up the remaining 3%.

The company is set to release its financial results for the first quarter of this fiscal year on August 13, 2024.