Shares of PNC Infratech Ltd., a well-known infrastructure company, fell to a 20% lower circuit on Monday following a significant development. The Ministry of Road Transport & Highways disqualified the company and its two subsidiaries from participating in any tender process for one year, effective from October 18, 2024. This decision has triggered a sharp decline in the company’s stock price.
Share Price Movement
In the Monday trading session, the share price of PNC Infratech Ltd. dropped to an intraday low of ₹366.70 per share, compared to its previous close of ₹458.35 per share. This marks a 20% decrease and hits the lower circuit limit. Over the last six months, the company’s stock has experienced a decline of over 15%.
Reason for the Stock Decline
The Ministry of Road Transport & Highways disqualified PNC Infratech Ltd. and its subsidiaries—PNC Khajuraho Highways Pvt. Ltd. and PNC Bundelkhand Highways Pvt. Ltd.—following a personal hearing on October 18, 2024. The hearing was held in response to an FIR and charge sheet filed by the Central Bureau of Investigation (CBI) in June and August of this year. This disqualification bars the company from participating in any tender process for one year.
PNC Infratech responded by stating in its exchange filing that the disqualification will not affect ongoing development, construction, or operations and maintenance activities. However, the company is assessing the potential impact on other business operations.
Current Order Book and Project Pipeline
As of the June quarter, PNC Infratech had projected an order intake of ₹8,000 crore to ₹10,000 crore for FY 2025, with ongoing orders valued at ₹5,000 crore where it was the lowest bidder. Around 82% of the unexecuted order book was attributed to highway, expressway, and canal projects, while 18% was from water-related contracts.
The company’s total executable order book was expected to reach ₹19,000 crore by the end of the June quarter, including the L1 (lowest bidder) status for projects worth ₹5,000 crore.
Future Prospects
Looking ahead, PNC Infratech anticipates a 15% revenue growth in FY26, driven by progress in current projects and the potential acquisition of new contracts. The company is also working to diversify its portfolio by entering the railway sector, actively bidding for railway infrastructure projects.
Financial Performance
In terms of financial performance, PNC Infratech Ltd. reported a 4% increase in revenue for Q1 FY25, reaching ₹2,168 crore compared to ₹2,092 crore in Q1 FY24. The company also saw a significant surge in Profit After Tax (PAT), which grew by 217%, from ₹181 crore in Q1 FY24 to ₹575 crore in Q1 FY25.
Company Overview
PNC Infratech Limited is a major player in the infrastructure sector in India, focusing on a variety of large-scale projects. Its portfolio includes the construction and management of highways, bridges, flyovers, power transmission lines, airport runways, and industrial area developments, among other ventures.
