NBCC - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 20 Dec 25, 11:15 pm

Fundamental Rating: 3.8

• 📈 Revenue Growth: Quarterly PAT improved from ₹114 Cr to ₹173 Cr (+39.5%), showing strong momentum
• 💰 Profit Margins: Healthy, ROE at 24.1% and ROCE at 32.1%
• ⚖️ Debt Ratio: Debt-to-equity at 0.00, debt-free operations
• 💵 Cash Flows: EPS of ₹2.05, modest relative to valuation
• 📊 ROE/ROCE: Strong efficiency, above industry averages
• 📉 Valuation: P/E 49.3 vs Industry PE 18.8, significantly overvalued
• 📚 Book Value: ₹9.34, P/B ~12.2, premium valuation
• 📈 PEG Ratio: 1.79, indicates stretched valuation relative to growth
• 🏢 Business Model: Government-owned construction and project management company specializing in real estate, infrastructure, and redevelopment projects
• 🛡️ Competitive Advantage: PSU backing, strong order book from government contracts, debt-free balance sheet

Positive

• ✅ Strong quarterly profit growth (+39.5%)
• ✅ Debt-free operations
• ✅ High ROE (24.1%) and ROCE (32.1%)
• ✅ Increased FII holdings (+0.35%)

Limitation

• ⚠️ High P/E ratio (49.3) compared to industry average (18.8)
• ⚠️ P/B ratio ~12.2, premium valuation
• ⚠️ PEG ratio at 1.79 indicates stretched valuation
• ⚠️ DII holdings reduced (-0.26%)

Company Negative News

• 📉 Valuation premium compared to peers
• 📉 Reduction in domestic institutional investor holdings

Company Positive News

• 🌍 Strong quarterly profit growth
• 🏗️ Expansion in government redevelopment and infrastructure projects
• 📈 Increased foreign institutional investor confidence

Industry

• 💹 Industry PE at 18.8, NBCC trades at a steep premium
• 📈 Construction and infrastructure sector supported by government spending and urban redevelopment initiatives

Conclusion

NBCC shows strong fundamentals with debt-free operations, high ROE/ROCE, and robust profit growth. However, valuations are stretched with high P/E and P/B multiples. Entry zone is attractive around ₹105–115 (near DMA 200 support). Long-term holding is favorable given PSU backing, strong government order book, and infrastructure growth, but caution is advised due to valuation risks.

Would you like me to extend this into a peer benchmarking overlay comparing NBCC with IRCON, RVNL, and NCC, or should we run a sector rotation scan to identify stronger compounding opportunities across infrastructure and construction plays?