NCC Ltd has bagged two orders from state-run BSNL, nearly the size of the construction company’s market capitalisation. Post this, the company’s shares surged over 6 per cent
Shares of construction company NCC Ltd surged more than 6 per cent on Wednesday, March 26, after bagging two major orders from the state-run telecom company Bharat Sanchar Nigam Limited (BSNL). The stock, during the session, touched an intraday high of Rs 218.30 per share on the BSE. Interestingly, the size of the order is nearly the same as NCC’s total market capitalisation. The company’s market capitalisation, as per the previous closing price on March 25, stood at Rs 12,836.32 crore.
NCC shares have surged nearly 20 per cent over the past month. However, year-to-date, the stock shows a decline of 23 per cent.
NCC announced on March 25 that it has secured two advance work orders worth Rs 10,804.56 crore (excluding GST) from BSNL for the design, supply, construction, installation, upgradation, operation, and maintenance of the BharatNet middle-mile network.
The first project, for the Uttarakhand Telecom Circle, is valued at Rs 2,647.12 crore, of which Rs 1,543.35 crore is set aside for capital expenditure (Capex) and Rs 1,103.77 crore for operational expenditure (Opex). The second contract, covering the Madhya Pradesh, DNH & DD Telecom Circles, is valued at Rs 8,157.44 crore, including Rs 4,189.05 crore for Capex and Rs 3,968.39 crore for Opex.
The construction phase is expected to take three years, followed by a ten-year maintenance period.
In Q3FY25, NCC reported a net profit of Rs 193 crore, down 12.5 per cent from Rs 221 crore in the same quarter last year, primarily due to slow order execution. Revenue from operations grew 1.61 per cent to Rs 5,345 crore against Rs 5,260 crore in the year-ago period.
NCC's EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) slipped 16.6 per cent to Rs 420.9 crore from Rs 504.4 crore a year ago. The EBITDA margin also narrowed to 7.9 per cent from 9.6 per cent. Meanwhile, the company's earnings per share (EPS) slipped to Rs 3.08 from Rs 3.51 in the same quarter last year.