Trendline Breakout and Cup & handle breakout Confirmation - NBCCTechnical Analysis:
Current Price: ₹111.08 (Note: As of the market close on Friday, May 16, 2025, NBCC closed around ₹110.85 on the NSE).
Target: Your target of ₹140 suggests a significant potential upside.
Trendline Breakout: Breaking above a significant downtrend line indicates a potential shift in momentum to the upside.
Cup & Handle Pattern Breakout Confirmation: The confirmation of a breakout from a Cup & Handle pattern is a strong bullish signal, suggesting a likely continuation of an upward trend.
Time Frame: A 1 to 3-month timeframe is reasonable for these patterns to play out, assuming the breakouts are sustained.
Confirming the Breakouts:
Volume: It's crucial to have seen a noticeable increase in trading volume during both the trendline and the Cup & Handle breakouts. Strong volume adds significant validity to these signals.
Sustainability: The price should hold above the breakout levels in the coming trading sessions.
Potential Upside:
Target (₹140): Represents a potential upside of approximately 26% from the ₹111.08 level (or around 26.3% from the ₹110.85 closing price).
Quarterly and Yearly Results & EPS Comparison:
Based on the information available up to the latest reported quarter (December 2024) and the previous fiscal year (FY24):
Latest Quarter Result (December 2024): NBCC reported a consolidated net profit of ₹113.45 Crore, a significant increase of 60.81% compared to the same quarter last year (December 2023). Total income also increased by 17.25% to ₹2456.54 Crore.
Yearly Result (FY2024): For the full fiscal year ending March 2024, NBCC's total revenue stood at ₹7835.59 Crore, a growth of 10.75% compared to FY23. The profit after tax for FY24 was ₹277.66 Crore, a growth of 10.54% YoY.
EPS Comparison:
Quarterly EPS (December 2024): ₹0.63, compared to ₹0.39 in December 2023.
Yearly EPS (FY2024): ₹1.54, compared to ₹1.39 in FY23.
We will need the results for the quarter ending March 2025 (Q4FY25) and the full fiscal year ending March 2025 (FY25) for the most up-to-date comparison. These are expected in the coming weeks.
P/E Comparison:
Based on the closing price of ₹110.85 and the FY24 EPS of ₹1.54, the current P/E ratio is approximately 71.98.
According to some sources, as of May 17, 2025, the P/E ratio is around 59.8. The construction and infrastructure sector can have a wide range of P/E ratios depending on growth prospects and company specifics. While seemingly high, it could be justified if the market anticipates strong future earnings growth, as suggested by the recent quarterly results. We'll get a clearer picture with the FY25 EPS.
Corporate Action:
Dividend: For FY24, NBCC declared a final dividend of ₹0.14 per share. Investors will be looking for any dividend announcement that typically accompanies the full-year results for FY25.
Order Book: NBCC has been consistently securing new orders, which is a positive sign for future revenue and profitability. Keep an eye on any new order wins announcements.
Latest News (as of May 17, 2025):
Recent news around NBCC has been generally positive, focusing on:
Strong Q3FY25 Results (Dec 2024): The significant jump in profit was a key highlight, boosting investor confidence.
Order Wins: NBCC continues to secure new projects across various sectors, including infrastructure and real estate. These new orders provide revenue visibility for the coming quarters.
Focus on Execution: The market is often looking at NBCC's ability to efficiently execute its large order book. Any positive updates on project progress are usually well-received.
Government Initiatives: Being a government-owned entity, NBCC's performance is also linked to government spending on infrastructure and housing. Positive policy announcements in these areas can be beneficial.
Key Factors to Monitor:
Breakout Sustainability: Ensure the price holds above the breakout levels with sustained volume.
Upcoming Q4 & FY25 Results: These will be crucial in determining if the recent profit growth trend continues and will impact the P/E valuation. Look for the announcement dates.
New Order Wins: Any further significant order wins will act as positive catalysts.
Execution Progress: Updates on the progress of major projects in their order book will be important.
Market Sentiment: Overall market sentiment and the performance of the infrastructure and construction sectors will play a role.
