NBCC – FY 14 – Results Discussion

Please read the annual results here :  NBCC FY 14 Results

With 81% revenue from PMC and 16% from Real Estate business, NBCC wrapped up the year with a consolidated sale of about 4,098cr. When you look at the margins, they are quite healthy and going by the MD, Mr.Mittal, they will get better.

PAT – 6.28%

PMC EBIT margin – 7.8%

Real Estate EBIT margin – 17.8%

The company’s balance sheet obviously does not show the value of the land bank of 155 acres, in various cities from Delhi to Cochin. Even if you value it at 10 cr an acre, it by itself amounts to 1,550 cr, almost half the M.Cap. Consider the developed sale value and it could almost equal or exceed the M.Cap.

Also the company has entered into 8 JV’s. There is not enough clarity or news about them but, this is what i could gather :

1. NBCC – R.K.Millen – failed to take off due to land acquisition from the West Bengal Govt.
2. Jamal NBCC International (PTY) – written off.
3. NBCC Agartala Municipal Corporation, NBCC -Mahabir Hanuman Group & NBCC Ahinsa Builders – have been consolidated into the books this year.
4. CPWD – NBCC JV consolidated into the accounts.
5. NBCC – HUDCO JV consolidated into the accounts.
6. NBCC – HUDCO JV KAUSHAMBI – consolidated into the accounts.

Not surprisingly, the transparency or rather the clarity in the project status at NBCC is not there. Adding to this confusion is the MD’s super casual way of answering questions on television, for which the company has to go back and give out clarification statements.

I know the company is and will do well, just hope that their investor communication improves 10x the prospects of the company.

Their order list can be viewed from this link         http://www.nbccindia.com/nbccindia/public/jsp_pub/more_what_news.jsp