Ahluwalia Contracts - Robust Order Book Gives Healthy Revenue Visibility In The Near Term: Axis Securities

Axis Securities Report

Ahluwalia Contracts India Ltd. has a well-diversified and robust order book position which gives healthy revenue visibility for the next three-four years. Moreover, favourable government thrust on building infrastructure and the revival of private capex are boosting the overall sentiments, which augers well for the company moving forward.

Valuation and recommendation:

We expect its revenue/Ebitda/adjusted profit after tax to grow at a CAGR of 21%/26%/33% respectively over FY24-26E. The stock is currently trading at 19 times FY26E EPS.

We value Ahluwalia Contracts at 22 times FY26E earnings per share to arrive at a target price of Rs 1,340/share, implying an upside of 13% from the current market price.

We, therefore, change our rating from Hold to Buy.

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