It's a well known fact that India is grossly under invested in infrastructure. In a move to bolster infrastructure investments in the country and enable higher economic growth, the government plans to double infrastructure spending to US$ 1 trillion in the 12th five year plan. Around 50% of the investment is expected to come from the private sector. This presents vast opportunities for the companies engaged in construction and infrastructure development in India. There is no doubt the sector will continue to remain preferred investment bet for investors over the longer term excluding near term execution concerns. If one wants to play the India story then exposure to the construction space is inevitable. But as there are plenty of companies listed on the Indian bourses, cherry picking is a difficult task.In this article, we try to decode key aspects of the construction companies that could possibly aid investors in selective stock picking.
Book to Bill Ratio | FY06 | FY07 | FY08 | FY09 |
IVRCL Infrastructure | 4.5 | 3.1 | 3.3 | 2.8 |
Nagarjuna Construction | 2.9 | 2.5 | 3.3 | 2.9 |
Hindustan Construction | 4.9 | 3.9 | 3.3 | 4.9 |
Investments as % of Capital Employed | FY06 | FY07 | FY08 | FY09 |
IVRCL Infrastructure | 24% | 15% | 13% | 12% |
Nagarjuna Construction | 6% | 28% | 23% | 25% |
Hindustan Construction | 6% | 9% | 10% | 11% |
Working capital cycle (Days) | FY06 | FY07 | FY08 | FY09 |
IVRCL Infrastructure | 122 | 179 | 179 | 164 |
Nagarjuna Construction | 168 | 68 | 121 | 139 |
Hindustan Construction | 77 | 187 | 164 | 192 |
D/E Ratio (Consolidated) | FY06 | FY07 | FY08 | FY09 |
IVRCL Infrastructure | 1 | 0.5 | 0.6 | 0.7 |
Nagarjuna Construction | 0.2 | 0.8 | 1 | 1.6 |
Hindustan Construction | 1.4 | 2.2 | 2.9 | 4.6 |
Particulars | Road BOT Projects | Water BOT projects | Power BOT projects | Miscellaneous | Total |
IVRCL Infrastructure | 7 | 2 | 0 | 1 | 10 |
Nagarjuna Construction | 5 | 0 | 3 | 8 | |
Hindustan Construction | 4 | 0 | 0 | 0 | 4 |
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1 Responses to "Things to watch out for in Infrastructure cos."
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danish
Dec 9, 2017good effort very useful information
Danish