NBCC Shares Soar 13% on winning order from SAIL

Shares of NBCC (India) Limited witnessed a remarkable surge, rising nearly 13% in today's trading session, driven by significant developments in the company's projects and collaborations.

Project Management Consultancy Order from SAIL

he state-owned civil construction firm, NBCC (India), received a substantial order valued at ₹180 crore from Steel Authority of India Limited (SAIL). This order pertains to consultancy and project management services for upcoming infrastructural-related projects of SAIL's Bokaro Steel unit, township, Mines, and collieries. The announcement resulted in a surge in NBCC's stock price, which gained 12.92% to reach ₹63.65 on the Bombay Stock Exchange (BSE) today. The surge in NBCC's stock price also led to an increase in the company's market capitalization, which climbed to ₹11,082 crore.

Quadripartite MoU for Asset Monetization

NBCC signed a quadripartite Memorandum of Understanding (MoU) with the Ministry of Steel (MoS) Government of India, Rashtriya Ispat Nigam Limited (RINL), and National Land Monetization Corp. Ltd. (NLMC). This MoU aims to facilitate the monetization of non-core assets of RINL at Vishakhapatnam. Under this agreement, NBCC will serve as the technical cum transaction advisor, assisting the Ministry of Steel (MoS), RINL, and NLMC in the asset monetization process.

Strong Financial Performance

NBCC reported impressive financial results for the first quarter of the fiscal year 2023-24. The company recorded a consolidated net profit of ₹77.41 crore, a substantial improvement compared to the net loss of ₹4.84 crore in the same period the previous year. Total income for the April-June quarter of FY24 increased to ₹1,965.80 crore from ₹1,853.24 crore in the corresponding period of the previous year. The net consolidated total income also grew by 6.61% to ₹1,917.87 crore in Q1 FY24, compared to ₹1,798.99 crore in the corresponding quarter last year.

Recent Project Wins

This positive news comes on the heels of NBCC's recent successes, including a ₹2,000-crore order from the Kerala State Housing Board for the development of 17.9 acres of land at Kochi's Marine Drive and ₹66.32 crore order from the Indian Medical Association for the planning, designing, and execution of IMA House at Indraprastha, New Delhi.

Company Overview

NBCC (National Buildings Construction Corporation Limited) is a multifaceted company that operates through several key segments, each contributing to its diverse portfolio. Established in 1960 as the construction arm of the Government of India, NBCC has since evolved into a prominent player in the civil engineering and construction sector. It serves a wide array of stakeholders, including state governments, central government ministries, and both public and private sectors. In recognition of its outstanding performance and contributions to the industry, NBCC achieved the prestigious 'Navratna' status in 2014.

NBCC's primary segments and its rich history

Project Management Consultancy (PMC): This segment is a cornerstone of NBCC's operations, accounting for a substantial 93% of its annual revenue. NBCC excels in providing expert project management services. It oversees and guides diverse construction and infrastructure projects, including civil construction projects, infrastructure works for national security, civil sector infrastructure projects, and the implementation of the Pradhan Mantri Gram Sadak Yojna (PMGSY). Additionally, the company plays a pivotal role in developmental work in the Northeastern Region, contributing significantly to the nation's progress.

Real Estate Development (RED): While relatively smaller in terms of revenue share at 4%, the Real Estate Development segment is integral to NBCC's operations. This segment primarily focuses on real estate development projects, spanning both residential and commercial properties. Through RED, NBCC contributes to meeting the growing demand for quality real estate in India.

Engineering Procurement and Construction (EPC): The Engineering, Procurement, and Construction (EPC) Contracting segment, though accounting for 3% of NBCC's revenue, showcases the company's prowess in executing comprehensive construction projects on a turnkey basis. This segment highlights NBCC's capabilities in delivering end-to-end solutions for complex engineering and construction endeavors.