NBCC - Investment Analysis

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

Investment Rating: 3.8

🏗️ Fundamental Analysis: NBCC (India) Ltd.

NBCC operates in the government infrastructure and project management space. While its capital efficiency is excellent, the valuation appears stretched, and earnings growth may not justify the current price levels.

Metric Value Implication

Stock P/E 48.5 Highly overvalued vs. industry PE of 23.8 — caution warranted

PEG Ratio 1.60 Over 1 — suggests growth may not justify high valuation

ROE / ROCE 25.9% / 33.5% Strong — efficient use of capital

Dividend Yield 0.48% Low — not a major income generator

Debt-to-Equity 0.00 Excellent — zero debt, strong balance sheet

EPS ₹2.00 Weak earnings base — limits valuation upside

Profit Growth (QoQ) +21.4% Solid — recent momentum, but sustainability is key

📉 Technical & Trend Analysis

Current Price: ₹110

DMA 50 / DMA 200: ₹113 / ₹103 — trading below 50 DMA, above 200 DMA

RSI: 36.1 — approaching oversold zone, potential bounce

MACD: -1.95 — bearish momentum

Volume: Slightly below average — weak conviction

✅ Is It a Good Long-Term Investment?

Moderately attractive, but not ideal for long-term compounding. While NBCC has strong ROE/ROCE and zero debt, its high P/E and PEG ratio suggest the stock is priced for perfection. The low EPS and dividend yield further weaken its long-term appeal unless earnings growth accelerates meaningfully.

🎯 Ideal Entry Price Zone

Buy Zone: ₹90–₹100

Closer to 200 DMA and technical support

Entry only if PEG drops below 1 and RSI confirms reversal

Avoid chasing momentum above ₹120 unless earnings surprise

🧭 Exit Strategy / Holding Period (If Already Holding)

If you're already invested

Holding Period: 12–24 months — monitor earnings growth and order book expansion

Exit Strategy

Partial Exit near ₹135–₹140 if valuation remains elevated (P/E > 40)

Hold if quarterly PAT growth sustains above 15% and PEG improves

Reassess if RSI drops below 30 and MACD continues negative — signals deeper correction

Would you like a comparison with other infra or PSU stocks like IRCON, Engineers India, or Rail Vikas Nigam to explore better value picks?

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