ITD Cementation India shares surged to hit a new 52-week high on Thursday (Aug 10) after it announced bagging a major contract from Bangladesh. Analysts at Nuvama expect order inflows to remain strong in the medium term.

The ITD Cementation India Analyst: The analyst team at Nuvama led by Mehul Mehta initiated the coverage on the stock with a ‘buy’ rating and a price target of ₹296. The target indicates an around 44% upside from the stock’s last closing price of ₹205.90.

The ITD Cementation India Thesis: The analysts said that in the past two years, the company’s growth prospects have improved significantly, thanks to a substantial influx of orders over the past two years. As a result, analysts expect the company’s revenue to grow at a Compound Annual Growth Rate (CAGR) of 32% over FY23-25.

Analysts noted that the company’s 20,000 crore order (as of March 2023) is a strong foundation for growth. The brokerage firm also added that the company’s margins are also expected to improve going forward.

The company’s EBITDA for FY23 was at 7.9%, analysts see it climbing to 10% by FY25 as the construction major has completed some projects that were losing money, like the Bengaluru elevated metro project. The analysts expect the company’s PAT to grow at a CAGR of 55% over FY23-FY25 driven by growth in EBITDA.

Price Action: ITD Cementation’s share price was down 0.92% to trade at ₹204 shortly after market open on Friday.

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