NBCC - Fundamental Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Fundamental Rating: 3.5

NBCC (India) Ltd. offers an intriguing mix of high operational efficiency and strategic public-sector mandates, though valuation and earnings depth present a few caution flags.

📊 Financial Highlights

Profit Metrics

ROCE: 33.5% and ROE: 25.9% — outstanding operational productivity and capital allocation.

EPS: ₹2.00 — low absolute earnings, slightly limiting valuation justification.

PAT jump from ₹138 Cr. to ₹244 Cr. — strong quarterly momentum (↑21.4%), suggesting improved execution or seasonal tailwinds.

Balance Sheet Strength

Debt-to-equity: 0.00 — clean balance sheet, commendable for infra players.

Dividend yield: 0.48% — modest, mainly symbolic.

📈 Valuation & Sentiment Signals

Metric Value Commentary

P/E Ratio 48.5 Rich compared to industry PE (23.8) — pricing in optimism or contracts backlog

P/B Ratio ~11.98 Very high for a public EPC company

PEG Ratio 1.60 Suggests valuation ahead of growth rate

Intrinsic Value ✖ Appears overvalued, barring exceptional future earnings leap

Conclusion: Stock is expensive on traditional metrics — may be justified only if robust execution and contract wins continue.

🏢 Business Model & Competitive Position

A PSU under Ministry of Housing & Urban Affairs; specializes in project management consultancy (PMC) and real estate redevelopment.

Edge stems from government contracts and sovereign backing — offers execution security.

Business scale reliant on timely contract awards, clearances, and inter-agency coordination.

Growth tied closely to public infrastructure, Smart Cities mission, and urban housing.

📉 Technical Snapshot

RSI: 36.1 — approaching oversold zone; could signal buying interest at lower levels.

MACD: -1.95 — negative crossover, indicating weak near-term momentum.

Trading below 50-DMA (₹113) but above 200-DMA (₹103) — stuck in a consolidation wedge.

FII and DII holding trends positive — institutions nibbling selectively.

🎯 Entry Zone & Holding Strategy

Recommended Entry Zone: ₹100–₹106 — closer to 200-DMA, ideal for swing or accumulation.

Long-Term View

Plays well into India’s infrastructure theme, but earnings depth must improve to sustain multiples.

Best held in diversified portfolios as a high-beta PSU exposure, not core holding.

Suggest monitoring quarterly margins and order inflows before sizing up.

Want to pit NBCC against IRCON, Engineers India or RailTel for a sharper EPC/PSU sector view? I can crunch the comparative efficiency and valuation metrics for a complete picture. Just say when.

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