Ashoka Buildcon - Awaiting Asset Monetisation: IDBI Capital

IDBI Capital Report

We did site visit of Ashoka Buildcon Ltd.'s MOPA airport link road project and interacted with its management. ALR project is 82% complete and its commissioning is expected by March-2024 versus ministry of road transport and highways guideline of August-2024.

Ashoka Buildcon's asset monetisation for nine hybrid annuity mode project is in advance stage and share purchase agreement is expected by FY24E. However, for build operate transfer asset (Chennai outer ring road, Nayagaon) no objection certificate approval is awaited and transaction is getting delayed to FY25E.

Conclusion of asset monetisation is expected to reduce debt which is Rs 72 billion at consolidated basis.

We maintain our positive view on the stock as Ebitda margin is getting stabilized and H1 FY24 order book of Rs 148 billion equals to 2 times FY24E revenue.

Retain 'Buy' rating on the stock with revise SOTP base target price of Rs 206 as we roll forward to FY26E (earlier target price of Rs 191).

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