Shares of Ashoka Buildcon have surged over 45% in the last six months, and analysts at HDFC Securities see the stock going further up as it notes that the company has a healthy asset monetization pipeline and a diversified order book.
The Ashoka Buildcon Analyst: The Parikshit D Kandpal-led analyst team at HDFC Securities maintained the ‘buy’ rating on the stock raising the target price to ₹189 from ₹148. The revised target indicates an around 70% upside from the stock’s last closing price of ₹110.75.
The Ashoka Buildcon Thesis: The brokerage firm said that the infra stock has exhibited weaker performance compared to the broader infrastructure sector in the last 1 year, 2 years, and 5 years, despite its order book growing 2 times from FY19 to FY23.
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The brokerage firm highlighted that the company’s orderbook is well-diversified and is approximately 2.5 times its standalone revenue for FY23, offering revenue visibility in the medium term. The analysts also mentioned that the company has a robust asset monetization pipeline, with total proceeds expected to exceed the current market capitalization over the next three years.
The brokerage firm said that the company will see around ₹3,100 crore inflows in the next three years through asset monetization surpassing the company’s current market cap of around ₹2,900 crore.
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Price Action: Ashoka Buildcon’s share price was down 2.12% to trade at ₹108.60 in the mid-market hours of trading on Wednesday.
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