NCC - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.8
| Stock Code | NCC | Market Cap | 10,287 Cr. | Current Price | 164 ₹ | High / Low | 242 ₹ |
| Stock P/E | 16.1 | Book Value | 121 ₹ | Dividend Yield | 1.34 % | ROCE | 20.1 % |
| ROE | 10.7 % | Face Value | 2.00 ₹ | DMA 50 | 153 ₹ | DMA 200 | 176 ₹ |
| Chg in FII Hold | 0.62 % | Chg in DII Hold | 1.10 % | PAT Qtr | 106 Cr. | PAT Prev Qtr | 102 Cr. |
| RSI | 64.0 | MACD | 5.33 | Volume | 23,22,578 | Avg Vol 1Wk | 39,36,668 |
| Low price | 130 ₹ | High price | 242 ₹ | PEG Ratio | 0.60 | Debt to equity | 0.28 |
| 52w Index | 30.2 % | Qtr Profit Var | -42.6 % | EPS | 9.37 ₹ | Industry PE | 18.5 |
📊 Financials: NCC shows solid fundamentals with ROE at 10.7% and ROCE at 20.1%, supported by a manageable debt-to-equity ratio of 0.28. EPS stands at ₹9.37, and quarterly PAT improved slightly (₹106 Cr vs ₹102 Cr), though profit variation (-42.6%) highlights volatility. Dividend yield of 1.34% provides moderate income support.
💹 Valuation: The stock trades at a P/E of 16.1, below the industry average of 18.5, suggesting fair valuation. PEG ratio of 0.60 indicates undervaluation relative to growth potential. Book value of ₹121 provides strong intrinsic backing. Overall, valuation appears attractive compared to peers.
🏭 Business Model: NCC operates in construction and infrastructure, with strengths in government contracts and project execution. Its competitive advantage lies in scale, diversified projects, and improving institutional confidence. However, earnings volatility and sector cyclicality remain challenges.
📈 Entry Zone: Attractive entry would be near ₹150–₹155, aligning with support levels and undervaluation. Current price (₹164) is above the 50 DMA (₹153) but below the 200 DMA (₹176), suggesting short-term strength with medium-term caution. Long-term investors may accumulate gradually, with focus on sustained earnings growth.
Positive
- Fair valuation with P/E below industry average.
- PEG ratio of 0.60 highlights undervaluation.
- ROCE (20.1%) indicates strong efficiency.
- FII (+0.62%) and DII (+1.10%) holdings increased, showing institutional confidence.
Limitation
- ROE remains modest at 10.7%.
- Quarterly profit variation (-42.6%) highlights volatility.
- Trading volume below average, showing reduced momentum.
Company Negative News
- Profit volatility with weak quarterly growth.
- Sector cyclicality impacts earnings stability.
Company Positive News
- Institutional confidence with FII and DII inflows.
- Quarterly PAT improved slightly (₹106 Cr vs ₹102 Cr).
- Strong project pipeline in infrastructure development.
Industry
- Construction and infrastructure sector remains cyclical and policy-driven.
- Industry P/E at 18.5 highlights NCC’s fair valuation.
- Government-backed projects provide stability but limit diversification.
Conclusion
⚖️ NCC demonstrates fair valuation with strong efficiency and institutional support. Entry is favorable near ₹150–₹155 for long-term investors. Current levels suggest cautious accumulation, with better opportunities on dips. Holding is viable if project execution sustains, but earnings volatility remains a risk.