PNC Infratech Makes Lacklustre Debut; Management Optimistic on Performance

PNC Infratech made its debut on the exchanges today. Its shares opened at Rs 381 on the Bombay Stock Exchange and jumped to intraday high of Rs 387.80 but soon fell prey to selling pressure and its stock price fell to intraday low of Rs 346. PNC Infratech's initial public offer, which was closed on May 12 did not see an encouraging response and was oversubscribed 1.54 times. PNC Infratech is an Agra-based infrastructure developer, incorporated in 1999. The company specialises in roads and highway construction projects and deals mainly in EPC contracts. In 2012 PNC Infratech diversified into build, operate and transfer (BOT) mode and annuity projects. Through the IPO the company raised Rs 480 crore by selling 1.29 crore shares to public. Post the public issue the management holds 56.1 per cent stake in the company. Out of Rs 480 crore garnered by the company from the IPO, PNC Infratech plans to use Rs 150 crore for working capital, Rs 65 crore will be spent on BOT Projects, Rs 103 crore on equipment and Rs 35 crore will be used for repaying its high cost debt. Talking to NDTV, PNC Infratech's promoter Yogesh Kumar Jain, told in past nine months company had posted top line growth of 47 per cent and net profit growth of 68 per cent and he expects Infrastructure sector to grow going ahead. (Watch) PNC Infratech, which reported an earnings per share of Rs 17 for the nine months ended December 31, 2014 is currently executing 23 engineering, procurement and construction (EPC) projects and total of 8 BOT projects, said Mr Jain. Out of eight BOT projects, two projects are annuity based and five are toll based projects and are currently operational, added Mr Jain. Mr Jain said, "Total investment in BOT projects is at Rs 490 crore of which company has already invested Rs 425 crore. Rs 65 crore will be invested from IPO proceeds." Commenting on order book, Mr Jain said, "Currently company is executing projects worth Rs 7,850 crore of which projects worth Rs 4,300 crore have already been executed." "Balance projects worth Rs 3,500 crore will be completed within two years," added Mr Jain. At the issue price of Rs 378 PNC Infratech's shares are valued at 14 times its FY15 estimated earnings, which compares to 17 times for its listed peer KNR Constuction and 11.7 times for MBL Infra. Mr Jain is very much optimistic about its future order book. He expects projects worth Rs 50,000 crore will be coming up in UP specially around Agra and adjoining areas.

PNC Infratech Makes Lacklustre Debut; Management Optimistic on Performance

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