The infrastructure sector is a critical driver of India’s economic growth. The infrastructure sector is crucial in propelling India’s all-encompassing growth. It garners substantial focus from the Government, which is dedicated to enforcing policies that ensure the prompt creation of world-class infrastructure nationwide.
Ashoka Buildcon Limited, a distinguished entity in the Fortune India 500 list, is one of India’s premier highway developers. Recently, on May 23, 2024, the company disclosed its financial performance for the fourth quarter of the fiscal year 2024.
The article aims to provide a comprehensive analysis of Ashoka Buildcon Ltd’s Q4 FY2024 financial results.
About Ashoka Buildcon Ltd
Ashoka Buildcon Ltd. stands as a prominent figure in the infrastructure development sector in India, boasting over four and a half decades of experience in the construction industry. The company has significantly shaped the nation’s infrastructure, having built more than 14,000 lane kilometres of highways.
Beyond its expertise in road construction, Ashoka Buildcon has made substantial strides in power transmission and distribution (T&D) projects. It has brought essential electricity services to over 30,000 villages, enhancing the living standards of residents and contributing to the wider economic development of these regions.
Alongside its construction and power projects, Ashoka Buildcon has a notable footprint in the human resources sector. The company takes pride in its family of over 10,000 members, reflecting its commitment to creating jobs and fostering employee welfare.
From a financial perspective, Ashoka Buildcon has a solid order book exceeding ₹11,000 crores. This figure underscores the company’s robust market position and the sustained demand for its services. It represents the total value of contracts that the company has won but is yet to fulfil, offering a snapshot of its potential future revenue.
Ashoka Buildcon share dividend
Since February 11, 2013, Ashoka Buildcon Ltd. has announced dividends on 11 occasions. However, the dividend payout ratio of the company is 0% as of March 2024.
Ashoka Buildcon Ltd’s quarterly performance
Here are some of the key financial metrics of Ashoka Buildcon Q4 results, compared to the previous quarter:
| Q4 FY24(₹ crores) | Q3 FY24(₹ crores) | Change(%) | |
| Revenue | 3,052 | 2,657 | 14.09 |
| Operating profit | 626 | 587 | 6.64 |
| Profit before tax | 417 | 189 | 120.63 |
| Net profit | 254 | 99 | 156.57 |
| EPS | 8.89 | 3.43 | 159.18 |
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Ashoka Buildcon Ltd’s annual performance
Here are the principal financial metrics of the company, in comparison with the figures from the previous year:
| FY2024(₹ crores) | FY2023(₹ crores) | Change(%) | |
| Revenue | 9,798 | 8,100 | 20.96 |
| Operating profit | 2,233 | 1,969 | 13.41 |
| Profit before tax | 870 | 588 | 47.96 |
| Net profit | 521 | 373 | 39.68 |
| EPS | 17.92 | 13.23 | 35.45 |
Market reaction to Ashoka Buildcon Ltd’s results
Ashoka Buildcon Ltd released its quarterly results on May 23, 2024. On that day, Ashoka Buildcon’s share price hit a 52-week high of ₹197.50. When looking at Ashoka Buildcon Ltd’s share price history over the past 5 years, the Ashoka Buildcon share has given a return of 42.48%.
As of May 25, the sentiment of analysts towards Ashoka Buildcon’s share price target is quite varied.
Out of the 9 analysts who have evaluated the stock, 6 have recommended it as a strong buy, 1 has suggested to buy, 1 has advised to hold onto the shares, and 1 has given a sell recommendation.
No analyst has given a strong sell rating. This diverse range of opinions reflects the complex dynamics of the stock market and the varying perspectives of different analysts.
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Peer analysis
Let’s compare the key financial ratios of Ashoka Buildcon Ltd with that of its competitors:
| Company | CMP (₹) | Market cap(₹ crores) | P/E | Earnings Yield (%) |
| Ashoka Buildcon | 182.30 | 5,111 | 11.6 | 21.3 |
| NCC | 282 | 17,699 | 24.2 | 9.63 |
| G R Infraprojects | 1,614 | 15,601 | 13.5 | 10.0 |
| PNC Infratech | 559 | 14,348 | 15.8 | 9.09 |
| KNR Constructions | 272 | 7,658 | 13.8 | 9.39 |
Also read: India’s billion-dollar infrastructure industry: How to invest in it?
Ashoka Buildcon Ltd: Q4 FY24 Business Highlights
Ashoka Buildcon Ltd, a prominent player in the infrastructure development sector, has announced a series of noteworthy events in Q4 FY24.
The City & Industrial Development Corporation of Maharashtra Limited (CIDCO) awarded the firm the contract to design and build a stilt bridge for the eastern connectivity of Navi Mumbai International Airport (NMIA) in January 2024. The project, carried out in collaboration, is valued at Rs. 662.55 crore.
A subsidiary of Ashoka Buildcon Limited, Unison Enviro Private Limited, was sold to Mahanagar Gas Limited (“MGL”). The sale was consummated in February 2024 by Ashoka Buildcon Limited and an investment vehicle managed by Morgan Stanley India Infrastructure (MSII). The deal was completed at an equity consideration of Rs.562.09 Crore, with Ashoka Buildcon receiving ₹286.67 Crore for its 51% stake.
The Bharatmala project in Bihar, which included the EPC mode and the six-laning of the Aurangabad to Bihar-Jharkhand Border (Chordaha) section of National Highway 2 (PKG-1), was also given to the business in February 2024. The total contract value for this project is Rs. 520 crore.
In March 2024, the company announced January 13, 2023, as the Commercial Operations Date (CoD) for a stretch of 4.415 km of the ‘Six Laning of Belgaum – Khanapur Section of NH-4A’ project. This is in addition to a stretch of 16.345 km already operational since October 25, 2021 (First CoD).
The company stated that the Special Purpose Vehicle (SPV) for the project received a Provisional Certificate for the completion of 20.76 km in total, out of the total Project stretch of 30.80 km. The SPV will be able to collect an extra Annuity from NHAI for the 15-year operation period, with payments spaced every six months, thanks to the declaration of CoD.
The National Highways Authority of India awarded the business a Completion Certificate for the ‘Eight Lane Vadodara Kim Motorway’ project in April 2024, under the Hybrid Annuity Mode (HAM) Project. One of the company’s subsidiaries, Ashoka Ankleshwar Manubar Motorway Private Limited (SPV), is responsible for carrying out the project. The SPV has already been receiving an Annuity amount for 11.25 km from NHAI.
Lastly, GVR Ashoka Chennai ORR Limited became a wholly-owned subsidiary of Ashoka Buildcon Limited after the latter bought 50% of the fully paid-up equity shares held by GVR Infra Projects Limited in the former.
These events underscore Ashoka Buildcon Ltd’s ongoing expansion and dedication to infrastructure development in India.
Bottomline
Ashoka Buildcon Ltd. consistently showcases its formidable standing in the Indian infrastructure industry through significant financial expansion and strategic procurement of projects. The company’s impressive performance in Q4 FY2024 highlights its operational prowess and competitive edge in the market.
With its vast experience and substantial market footprint, Ashoka Buildcon Ltd. is strategically poised to fuel future growth. Its wide-ranging project portfolio, strategic alliances, and dedication to innovation and quality emphasise its crucial contribution to infrastructure development in India.
