PNC and KNR shares shine with difficulties. Stock Market News.




PNC Infratech and KNR Construction shares shine despite difficulties.

The ET Construction Index has fallen 10 per cent in the last 12 months. There are many reasons for this. During this time, the orders from the National Highways Authority of India (NAAI) have decreased. Companies have faced difficulties in raising capital. Apart from this, there is a delay in completing the order.

Shares of PNC Infratech and KNR Construction have jumped 26–46 per cent. This is due to better execution, cash flow and lower expenses. The order book of these companies seems strong for the next two years. The shares of these companies are at a premium to the rival companies.


PNC Infratech and KNR Construction have made a mark on their solid financial performance. While the industry is troubled by the weak pace of implementation, PNC's revenue in the September quarter has gone up by 84 per cent and KNR by 31 per cent over the previous year.


Analysts are also focused on the cash flows of these companies. According to the Capitaline database data, in FY 2018-19, operating cash flows of these companies were 10 to 12 per cent of sales, compared to 7 per cent for rival companies.


The debt to equity ratio of these companies is less than one, which is much better than their competitors. This ratio is 4.2 times the average for them. On the business front too, PNC and KNR have shown strength. These are available at a discount of 28 to 40 percent compared to both rivals.


Promoters of other rival companies have pledged their partial or full stake. In such a situation, the situation of liquidity seems serious. However, the promoters of these two companies have not yet done any plaging of their stake.


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