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Tuesday, October 16, 2012

NBCC- Opportunity lies ahead

The Last time I discussed NBCC was during its IPO period and since then many new events have been unfolded.

First, NBCC has been conferred a Miniratna status- a title given by the government of India to Public Sector Companies for their excellence which gives them more autonomy to grow- Miniratna status is lower in statute than Navrtana and Maharatna status.

Second, NBCC's financial results for the year FY 12 were satisfactory.
NBCC is a debt-free infrastructure development and real estate company and by this date has given a whopping 34 % return on its issue price of Rs. 106.
This stock is presently trading at around 9 times its Price-to-Earnings multiple and 2.1 times its Price-to Book value. NBCC has a robust order book and a land bank of 54 lakh square feet with significant presence in NCR (National Capital Region).
Even a conservative target for this company shall be around Rs. 180 (which is a further appreciation of 28% from the present  level) and this target could be achieved in next 1-1.5 year provided overall market does not go in a tailspin.
Private 'Real Estate Companies' marred by the allegations of indulging in the fraudulent nexus with politicians augurs well for this company.
If this stock starts falling with the overall market, one may start accumulating it with a medium to long term view in mind.


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