RESULTS REVIEW 3QFY17 13 FEB 2017

NCC
BUY
INDUSTRY INFRASTRUCTURE Slowing growth
CMP (as on 10 Feb 2017) Rs 87 NCC Ltd. (NCC) delivered APAT beat largely on Highlights of the quarter
account of an Rs 193mn reduction in YoY interest
Target Price Rs 100 Muted revenue, APAT beat: NCCs 3QFY17 APAT was
costs. On the balance sheet front, gross debt is stable
33.1% ahead of estimates, primarily on account of
Nifty 8,794 at Rs 20.6bn (-Rs 173mn QoQ) and net D/E stood at
lower interest and depreciation. Limited new capex
Sensex 28,334 0.55x. Debtors increased to 76 days vs. 70 days in
coupled with overall reduction in debt and interest
2QFY17. 9MFY17 standalone order inflow stood at Rs
KEY STOCK DATA rates led to this outperformance.
62.6bn ex-L1/subsidiary orders of Rs 30/30.5bn.
Bloomberg NJCC IN
NCC has monetised roads and power assets. Its focus Order inflows back-ended though robust: NCC has
No. of Shares (mn) 556
is on the recovery of its Rs 12bn exposure to real secured new orders worth Rs 93.1bn (Rs 62.6bn ex-
MCap (Rs bn) / ($ mn) 49/726 estate, and it foresees a Rs 1bn annual reduction. subsidiary mining order of Rs 30.5bn) and has L1 status
6m avg traded value (Rs mn) 501 This will result in BS deleveraging. Other income is in Rs 30bn orders. The total order backlog, including
STOCK PERFORMANCE (%) expected to reduce by 45% YoY to Rs 1bn, as NCC has the mining order, stands at Rs 204.7bn. Standalone net
52 Week high / low Rs 96/56 monetized large subsidiary exposure. D/E is stable at 0.55x.
3M 6M 12M Earnings quality is improving with asset monetisation
and lower interest costs. We have cut FY18-19E Near-term outlook: Shift to asset-light model, focus on
Absolute (%) 7.4 10.9 43.5
revenue/EPS forecast by 8-14%, to factor in back- EPC projects and new opportunities in MDO will be key
Relative (%) 4.4 8.9 24.2
ended orders. Stable debt and working capital will drivers for further re-rating. Real estate monetisation is
SHAREHOLDING PATTERN (%) key to further deleveraging. We maintain a positive
help drive execution. Maintain BUY. Roll forward
Promoters 19.74 stance on the company.
with SOTP valuation of Rs 100/sh.
FIs & Local MFs 22.40
FIIs 23.03 Financial Summary (Standalone)
Public & Others 34.83 Year Ending March (Rs mn) Q3FY17 Q3FY16 YoY (%) Q2FY17 QoQ (%) FY16 FY17E FY18E FY19E
Source : BSE Net Sales 19,037 20,540 (7.3) 19,479 (2.3) 83,252 80,481 83,570 90,096
EBITDA 1,742 1,855 (6.1) 1,711 1.8 7,374 7,056 7,725 8,341
APAT 661 570 15.8 464 42.3 2,432 2,195 2,570 2,833
Diluted EPS (Rs) 1.19 1.03 15.8 0.83 42.3 4.4 3.9 4.6 5.1
P/E (x) 19.9 22.0 18.8 17.1
Parikshit D Kandpal EV / EBITDA (x) 8.8 9.3 8.4 7.9
parikshitd.kandpal@hdfcsec.com RoE (%) 7.4 6.3 6.9 7.1
+91-22-6171-7317 Source: Company, HDFC sec Inst Research
HDFC securities Institutional Research is also available on Bloomberg HSLB <GO>& Thomson Reuters
 NCC : RESULTS REVIEW 3QFY17

NCC 3QFY17 RPAT was 33.1% Standalone Quarterly Financial

ahead of our estimates on Particulars (Rs mn) Q3FY17 Q3FY16 YoY (%) Q2FY17 QoQ (%) 9MFY17 9MFY16 YoY (%)
the back of savings in interest Net Sales 19,037 20,540 (7.3) 19,479 (2.3) 57,526 58,730 (2.0)
costs (-16.1% YoY) to Rs Material Expenses 16,011 17,261 (7.2) 16,489 (2.9) 48,587 49,519 (1.9)
1,009mn and tax savings of Employee Expenses 829 775 7.0 846 (2.0) 2,445 2,232 9.5
596bps YoY Other Operating Expenses 454 649 (30.1) 433 5.0 1,384 1,692 (18.2)
EBITDA 1,742 1,855 (6.1) 1,711 1.8 5,110 5,287 (3.3)
Exceptional items include Depreciation 284 274 3.8 282 0.7 844 825 2.3
investment gains of Rs EBIT 1,458 1,581 (7.8) 1,428 2.1 4,266 4,462 (4.4)
142.2mn, which have been Other Income (Incl. EO Items) 388 458 (15.3) 238 63.3 998 1,689 (41.0)
net off against loss on loans Interest Cost 1,009 1,202 (16.1) 986 2.3 2,935 3,782 (22.4)
and advances to group PBT 837 837 (0.0) 680 23.1 2,329 2,369 (1.7)
companies worth Rs 220mn, Tax 181 231 (21.6) 229 (20.8) 613 613 0.0
resulting in Rs 77.8mn loss RPAT 656 606 8.2 451 45.4 1,716 1,757 (2.3)
E/o (adj for tax) 5 (36) NM 13 NM (68) (217) NM
NCC 3QFY17-end gross debt APAT 661 570 15.8 464 42.3 1,648 1,540 7.0
was Rs 20.4bn (vs Rs 20.6bn Source: Company, HDFC sec Inst Research
end 2QFY17) and gross D/E
at 0.55x Margin Analysis
Q3FY17 Q3FY16 YoY (bps) Q2FY17 QoQ (bps) 9MFY17 9MFY16 YoY (bps)
Owing to slow economic Material Expenses % Net Sales 84.1 84.0 8 84.7 (54) 84.5 84.3 14
recovery and Employee Expenses % Net Sales 4.4 3.8 58 4.3 1 4.3 3.8 45
Other Operating Expenses % Net Sales 2.4 3.2 (78) 2.2 16 2.4 2.9 (47)
demonetisation, NCC has
EBITDA Margin (%) 9.2 9.0 12 8.8 37 8.9 9.0 (12)
slowed execution of the
Tax Rate (%) 21.6 27.6 (596) 33.7 (1,202) 26.3 25.9 46
Electrical segment and now
APAT Margin (%) 3.4 3.0 49 2.3 113 3.0 3.0 (1)
expects muted YoY revenue Source: Company, HDFC sec Inst Research
growth vs 5% earlier
Order Book Assumptions
YTDFY17 standalone order Particulars (Rs mn) FY15 FY16 FY17E FY18E FY19E
intake stood at Rs 62.6bn ex Opening (Incl. Escalations) 2,09,580 1,93,230 1,76,550 1,91,874 2,18,672
L1 of Rs 30bn. NCC has also Add: New Order Wins 73,810 74,330 95,805 1,10,368 1,27,144
included a Rs 30.5bn mining Less: Execution (Revenues) 82,969 83,252 80,481 83,570 90,096
order in JV with BGR Mining. Closing Order Book 2,00,421 1,84,308 1,91,874 2,18,672 2,55,719
Hence conso. new orders are Trailing Order Book/Sales (x) 2.4 2.2 2.4 2.6 2.8
Source: Company, HDFC sec Inst Research
Rs 93.1bn ex L1 of Rs 30bn
Page | 2
 NCC : RESULTS REVIEW 3QFY17

We expect NCCs order book Order book To Multiply 1.33x Over FY17-19E EBIDTA Margins To Expand To 9.3% By FY19E
to multiply 1.33x over the Order Book (Rs mn) Revenues (Rs mn) Revenues (Rs mn) EBIDTA Margins (%)
FY17-19E period to Rs Order book/sales (x) Rs bn %
100 12.0%
255.7bn Rs bn x
310 4.0 90
10.0%
260 3.5 80
8.0%
70
210 3.0
60 6.0%
160 2.5
50
Building, roads and water 110 2.0
4.0%
40
segments will be the key 2.0%
60 1.5 30
drivers of the order book
10 1.0 20 0.0%

FY09
FY10
FY11
FY12
FY13
FY14
FY15
FY16
FY17E
FY18E
FY19E
FY09
FY10
FY11
FY12
FY13
FY14
FY15
FY16
FY17E
FY18E
FY19E
Source: Company, HDFC sec Inst Research Source: Company, HDFC sec Inst Research
EBIDTA margins would see
further expansion on account
of better margins in new Order Inflow: 15.2% FY17-19E CAGR Order Book Mix Dominated by Buildings & Water
order wins Rs bn Intl.
160
Mining 7%
Buildings
140 15%
and
Metals Housing,
120 Roads, O&G
1%
39%
100
Over FY17-19E, we build in an
80
order book inflow CAGR of Power
15.2% to Rs 127.1bn. Annual 60 1%
order inflows would be in the 40 Irrigation
range of Rs 100-130bn
10%
20
Electrical Water, Env
FY09

FY10

FY11

FY12

FY13

FY14

FY15

FY16

FY17E

FY18E

FY19E

division & Railways

8% 19%

Source: Company, HDFC sec Inst Research Source: Company, HDFC sec Inst Research

Page | 3
 NCC : RESULTS REVIEW 3QFY17

We expect 15.4% FY17-19E Key Assumptions & Estimates

order book CAGR Growth %
Key Assumptions (Rs mn) FY17E FY18E FY19E Comments
FY17E FY18E FY19E
Despite a pick-up in order Closing order book 1,91,874 2,18,672 2,55,719 8.7 14.0 16.9 We expect 15.4% FY17-19E order book CAGR
We estimate 15.2% FY17-19E CAGR. This will be driven by
inflow, we estimate 5.8% New order booking 95,805 1,10,368 1,27,144 28.9 15.2 15.2
Buildings, Water and Roads
FY17-19E revenue CAGR. Book to bill ratio 2.4 2.6 2.8 Book-to-bill ratio to remain stable
Back-ended order book We estimate 5.8% FY17-19E revenue CAGR. Back ended
Total Revenue 80,481 83,570 90,096 (3.3) 3.8 7.8
growth the key reason for order book growth key factor
muted revenues FY17-19E EBIDTA CAGR of 8.7% is higher than revenue
EBIDTA 7,056 7,725 8,341 (4.3) 9.5 8.0
CAGR owing to better order margin mix
EBIDTA margin (%) 8.8 9.2 9.3 (9.0) 47.6 1.4
FY17-19E EBIDTA CAGR of
Depreciation 1,129 1,174 1,258 2.7 4.0 7.1
8.7% We expect borrowing cost to reduce on account of asset
monetisation proceeds inflow (Rs 2.8bn) and improvement
Financial Charges 4,027 4,114 4,215 (20.7) 2.2 2.4
Interest costs will be stable in NCC credit rating and hence better fund/non-fund based
with deleveraging on account charges
OI reduction as loans and advances to subsidiary has come
of asset monetisation and Other income 1,277 1,235 1,178 (27.5) (3.3) (4.6)
down owing to monetization
likely improvement in NCC PBT 3,177 3,672 4,047 7.3 15.6 10.2 FY17-19E PBT CAGR of 12.9%
credit rating Tax 850 1,102 1,214 16.2 29.6 10.2
We have prudently assumed 30% tax for FY18-19E in line
Other income will reduce Tax rate (%) 26.8 30.0 30.0 with the Union budgets direction on reducing corporate
materially as NCC has taxes by 5% over 4yrs.
APAT 2,195 2,570 2,833 (9.7) 17.1 10.2 FY17-19E PAT CAGR of 13.6%
divested stakes in Bangalore
Gross Block Turnover 5.8 5.6 5.6
Elevated Toll, Western UP Toll
Debtor days 71 75 75 To deteriorate on new Irrigation/water projects
and NCC power project. This
Cash flow improvements in line with EBIDTA growth and
will result in reduction of CFO - a 3,390 5,237 3,818
EBIDTA margins expansion
loans to subsidiaries. The CFI - b (1,099) (1,200) (1,200) We are building cumulative Rs3,500mn capex over FY17-19E
overall reduction will result in FCF - a+b 2,291 4,037 2,618 Strong free cash flow generation as growth moderates
other income reducing by CFF - c (4,039) (4,676) (4,777) Interest cost outflow
45% during FY17-19E Total change in cash - a+b+c (1,749) (640) (2,159) Net cash position doesnt change debt materially
Source: HDFC sec Inst Research

FY17-19E APAT CAGR of

13.6%

Page | 4
 NCC : RESULTS REVIEW 3QFY17

Change in estimates
We have cut NCC standalone
EPC revenue by 8-14% to
factor in back-ended order
book growth and pockets of
slow moving segments like
Electrical
EBIDTA margins have been
largely retained in the 9-
9.3% range
Owing to back-ended order book growth and slowing
Telangana irrigation orders, we have cut NCCs
revenue estimates for FY17-19E by 8-14%.
NCC has disappointed with continuous revenue
guidance downgrades from 10% to 5%, and now
negative to muted FY17E revenue growth.
NCC has a weak Roads segment order book of Rs 4.5bn
(2.1% of order backlog), and Buildings and Water are
key segments with 39% and 19% contribution to the
order book. In an event of slowing of orders in key
segments, NCC may face growth challenges.
We have maintained EBIDTA margins and cut our
interest cost assumptions, as NCC has been able to
lower borrowing costs to 11.25%.
Limited new capex (Rs 500-600mn/annum) has
resulted in 9-11% cut in depreciation.
On a net basis, we have cut our EPS estimates 9-14%
over the FY18-19E period

FY17E FY18E FY19E

We have cut our Rs mn
New Old % Change New Old % Change New Old % Change
depreciation and interest Net Revenues 80,481 87,548 (8.1) 83,570 96,492 (13.4) 90,096 1,04,774 (14.0)
estimates by 9-13% to factor Material Expenses 68,282 73,607 (7.2) 70,564 80,930 (12.8) 76,124 87,848 (13.3)
in lower capex and interest Employee Expenses 3,292 3,327 (1.1) 3,360 3,570 (5.9) 3,469 3,877 (10.5)
rates Other Ope Exp. 1,851 2,714 (31.8) 1,922 2,991 (35.7) 2,162 3,248 (33.4)
EBIDTA 7,056 7,900 (10.7) 7,725 9,000 (14.2) 8,341 9,801 (14.9)
EBIDTA (%) 8.8 9.0 (25.6) 9.2 9.3 (8.4) 9.3 9.4 (9.7)
Depreciation 1,129 1,245 (9.3) 1,174 1,329 (11.6) 1,258 1,423 (11.6)
EBIT 5,927 6,655 (10.9) 6,551 7,672 (14.6) 7,083 8,378 (15.5)
Other Inc (incl. EO Items) 1,277 1,277 - 1,235 1,122 10.1 1,178 986 19.5
On a net basis, all this results Interest 4,027 4,638 (13.2) 4,114 4,753 (13.4) 4,215 4,677 (9.9)
in 9-14% EPS cut over the PBT 3,177 3,294 (3.6) 3,672 4,041 (9.1) 4,047 4,687 (13.7)
FY17-19E period Tax 850 980 (13.3) 1,102 1,212 (9.1) 1,214 1,406 (13.7)
RPAT 2,327 2,314 0.6 2,570 2,829 (9.1) 2,833 3,281 (13.7)
EO items (net of tax) (132) (132) - - - - - - -
APAT 2,195 2,182 0.6 2,570 2,829 (9.1) 2,833 3,281 (13.7)
APAT Growth (%) (9.7) (10.3) 17.1 29.6 10.2 16.0
Adj. EPS 3.9 3.9 0.6 4.6 5.1 (9.1) 5.1 5.9 (13.7)
EPS Growth (%) (4.3) (4.8) 10.4 22.2 10.2 16.0
Source: HDFC sec Inst Research

Page | 5

We have valued NCCs
standalone business at 8x
Mar-19 EV/EBIDTA, in line
with the past 10 years
average cross cycle multiple
at Rs90/sh
Real estate at 0.5x equity
invested - Rs 10/sh
We have excluded roads,
power and international
business from our valuation
estimates. These have either
been terminated or have no
basis to be a going concern
We arrive at a SOTP-based
target price of Rs 100/sh
Outlook and valuation
Reduce Target Price to Rs 100 implies ~14.9% upside
Valuation Methodology
We roll forward our estimates and value NCCs
standalone business at 8x Mar-19E EV/EBIDTA, in line
with the past 10 years average cross cycle multiple (Rs
90/sh) and real estate at 0.5x equity invested (Rs
10/sh). We have not valued Roads, Power and
International business
(1) Roads have been already monetised with Rs 1bn
expected inflow from Bangalore Elevated Tollways in
2HFY17E (Rs 820mn came in YTDFY17, Rs 280mn yet to
come), (2) Power asset NCC has already exited the
same and realised about Rs 2.7bn. Of these Rs 2bn
came in FY16, and (3) Rs 1-1.5bn is expected from NCC
urban in 2HFY17E, which should collectively aid in
balance sheet de-leveraging.
Our justification behind giving average cross cycle
multiple is (1) an improving order book with ~1.33x
increase over the FY17-19E period to Rs 255.7bn, (2)
strong 3QFY17-end balance sheet with net D/E at
Valuation
Particulars Segments Value (Rs mn)
NCC Standalone Construction business 50,225
Real Estate Real Estate 5,500
Total 57,802
Source: HDFC sec Inst Research
NCC : RESULTS REVIEW 3QFY17
0.55x, (3) concentrated focus on EPC segment of
infrastructure and (4) well-diversified presence across
different infrastructure sub-segments, viz. building,
roads, water, irrigation, power, mining, metals,
international, etc.
A further expansion in multiples is supported by NCCs
efforts on deleveraging the balance sheet, with likely
monetisation of Rs 2bn during 2HFY17E. We expect the
proceeds to be used partly towards debt reduction and
partly towards easing working capital needs. Quality of
earnings is expected to improve with reduction in
other income. We estimate 13.6% FY17-19E adjusted
EPS CAGR for NCC.
Investments in the the infrastructure sector will drive
NCCs stock performance. With strong EPC credentials,
the company will likely benefit from the pick-up in
ordering activity. We adopt SOTP methodology and
value NCC at Rs 100/share (previous Rs 97/share, at
7.5x Dec-18E, Real Estate Rs 7/sh).
Value per share(Rs) Rationale
90 At 8x Mar-19 EV/EBIDTA
10 At P/B multiple of 0.5x
100
Page | 6
 NCC : RESULTS REVIEW 3QFY17

Income Statement (Standalone) Balance Sheet (Standalone)

Year ending March (Rs mn) FY15 FY16 FY17E FY18E FY19E Year ending March (Rs mn) FY15 FY16 FY17E FY18E FY19E
Net Revenues 82,969 83,252 80,481 83,570 90,096 SOURCES OF FUNDS
Growth (%) 35.6 0.3 (3.3) 3.8 7.8 Share Capital 1,112 1,112 1,112 1,112 1,112
Material Expenses 71,463 70,756 68,282 70,564 76,124 Reserves 30,932 32,976 35,041 37,349 39,919
Employee Expenses 2,647 3,011 3,292 3,360 3,469 Total Shareholders Funds 32,044 34,088 36,153 38,461 41,031
Other Operating Expenses 2,366 2,111 1,851 1,922 2,162 Long Term Debt 2,625 1,020 1,020 1,020 1,020
EBIDTA 6,493 7,374 7,056 7,725 8,341 Short Term Debt 17,326 17,816 18,066 17,766 17,466
EBIDTA (%) 7.8 8.9 8.8 9.2 9.3 Total Debt 19,951 18,836 19,086 18,786 18,486
EBIDTA Growth (%) 60.4 13.6 (4.3) 9.5 8.0 Net Deferred Taxes 142 (208) (208) (208) (208)
Depreciation 1,118 1,100 1,129 1,174 1,258 Other Long-term Liabilities 535 497 497 497 497
EBIT 5,375 6,274 5,927 6,551 7,083 TOTAL SOURCES OF FUNDS 52,673 53,213 55,528 57,536 59,806
Other Income 1,951 1,762 1,277 1,235 1,178 APPLICATION OF FUNDS
Interest 5,736 5,076 4,027 4,114 4,215 Net Block 6,323 6,197 6,167 6,193 6,135
PBT 1,590 2,960 3,177 3,672 4,047 CWIP 79 76 76 76 76
Tax 472 731 850 1,102 1,214 Investments, LT Loans & Advances 14,443 12,542 12,542 12,542 12,542
RPAT 1,118 2,228 2,327 2,570 2,833 Total Non-current Assets 20,844 18,816 18,786 18,811 18,754
EO Items - 203 (132) - - Inventories 18,031 16,568 16,837 17,979 19,813
APAT 1,118 2,432 2,195 2,570 2,833 Debtors 13,632 13,245 15,655 17,172 18,513
APAT Growth (%) 175.9 117.5 (9.7) 17.1 10.2 Cash & Equivalents 1,127 2,158 1,687 2,282 1,302
EPS 2.0 4.4 3.9 4.6 5.1 Other Current Assets 40,697 43,450 41,894 41,900 45,172
EPS Growth (%) 175.9 117.5 (4.3) 10.4 10.2 Total Current Assets 73,488 75,421 76,073 79,333 84,800
Source: Company, HDFC sec Inst Research Creditors 17,656 21,229 18,301 18,775 20,241
Other Current Liabilities 24,003 19,795 21,030 21,834 23,506
Total Current Liabilities 41,659 41,024 39,331 40,609 43,747
Net Current Assets 31,829 34,397 36,742 38,724 41,053
TOTAL APPLICATION OF FUNDS 52,673 53,213 55,528 57,536 59,806
Source: Company, HDFC sec Inst Research

Page | 7
 NCC : RESULTS REVIEW 3QFY17

Cash Flow (Standalone) Key Ratios (Standalone)

Year ending March (Rs mn) FY15 FY16 FY17E FY18E FY19E FY15 FY16 FY17E FY18E FY19E
Reported PBT 1,590 2,960 3,177 3,672 4,047 PROFITABILITY (%)
Non-operating & EO items (112) 682 (1,277) (1,235) (1,178) GPM 13.9 15.0 15.2 15.6 15.5
Interest expenses 3,821 3,237 4,027 4,114 4,215 EBITDA Margin 7.8 8.9 8.8 9.2 9.3
EBIT Margin 6.5 7.5 7.4 7.8 7.9
Depreciation 1,118 1,100 1,129 1,174 1,258
APAT Margin 1.3 2.9 2.7 3.1 3.1
Working Capital Change (916) (2,141) (2,817) (1,387) (3,309)
RoE 3.9 7.4 6.3 6.9 7.1
Taxes Paid (362) (957) (850) (1,102) (1,214) Core RoCE 10.2 12.3 10.5 10.7 10.8
OPERATING CASH FLOW ( a ) 5,139 4,880 3,390 5,237 3,818 RoCE 9.8 11.4 9.5 9.5 9.7
Capex (499) (904) (1,099) (1,200) (1,200) EFFICIENCY
Free cash flow (FCF) 4,641 3,976 2,291 4,037 2,618 Tax Rate (%) 29.7 24.7 26.8 30.0 30.0
Investments (682) 2,757 - - - Asset Turnover (x) 6.9 6.6 5.8 5.6 5.6
INVESTING CASH FLOW ( b ) (1,181) 1,852 (1,099) (1,200) (1,200) Inventory (days) 79.3 72.6 76.4 78.5 80.3
Debt Issuance (4,795) (1,116) 250 (300) (300) Debtors (days) 60.0 58.1 71.0 75.0 75.0
Interest expenses (5,180) (5,746) (4,027) (4,114) (4,215) Other Current assets (days) 179.0 190.5 190.0 183.0 183.0
FCFE (5,334) (2,886) (1,486) (377) (1,896) Payables (days) 77.7 93.1 83.0 82.0 82.0
Other Currnt liab & provns (days) 105.6 86.8 95.4 95.4 95.2
Share capital Issuance 5,942 - - - -
Cash Conversion Cycle (days) 135.1 141.3 159.0 159.2 161.0
Dividend (61) (268) (262) (262) (262)
Debt/EBITDA (x) 3.1 2.6 2.7 2.4 2.2
FINANCING CASH FLOW ( c ) (4,093) (7,130) (4,039) (4,676) (4,777) Net D/E 0.6 0.5 0.5 0.4 0.4
NET CASH FLOW (a+b+c) (135) (398) (1,749) (640) (2,159) Interest Coverage 0.9 1.2 1.5 1.6 1.7
Non-operating and EO items 393 1,806 1,277 1,235 1,178 PER SHARE DATA
Closing Cash & Equivalents 710 2,118 1,687 2,282 1,302 EPS (Rs/sh) 2.0 4.4 3.9 4.6 5.1
Source: Company, HDFC sec Inst Research CEPS (Rs/sh) 4.0 6.0 6.2 6.7 7.4
DPS (Rs/sh) 0.4 0.4 0.6 0.6 0.6
BV (Rs/sh) 57.6 61.3 65.0 69.2 73.8
VALUATION
P/E 43.3 19.9 22.0 18.8 17.1
P/BV 1.5 1.4 1.3 1.3 1.2
EV/EBITDA 10.3 8.8 9.3 8.4 7.9
EV/Revenues 0.8 0.8 0.8 0.8 0.7
OCF/EV (%) 7.6 7.5 5.2 8.1 5.8
FCF/EV (%) 6.9 6.1 3.5 6.2 4.0
FCFE/Market Cap (%) 9.6 8.2 4.7 8.3 5.4
Dividend Yield (%) 0.5 0.5 0.7 0.7 0.7
Source: Company, HDFC sec Inst Research

Page | 8
 NCC : RESULTS REVIEW 3QFY17

RECOMMENDATION HISTORY
Date CMP Reco Target
NCC TP
120 11-Feb-16 57 BUY 95
25-May-16 71 BUY 96
110
16-Aug-16 77 BUY 95
100
7-Oct-16 87 BUY 96
90 10-Nov-16 79 BUY 104
80 13-Feb-17 87 BUY 100
70
60
Rating Definitions
50
BUY : Where the stock is expected to deliver more than 10% returns over the next 12 month period
Apr-16
Feb-16

Sep-16

Feb-17
Jun-16

Jul-16
Mar-16

Dec-16
Oct-16
Aug-16

Nov-16

Jan-17
May-16

NEUTRAL : Where the stock is expected to deliver (-)10% to 10% returns over the next 12 month period
SELL : Where the stock is expected to deliver less than (-)10% returns over the next 12 month period

Page | 9
 NCC : RESULTS REVIEW 3QFY17

Disclosure:
I, Parikshit Kandpal, MBA, authors and the names subscribed to this report, hereby certify that all of the views expressed in this research report accurately reflect our views about the subject
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Any holding in stock No

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