Buy HG Infra; target of Rs 1017: HDFC Securities

Broker Research

February 14, 2023 / 08:17 PM IST

HDFC Securities' probe study connected HG Infra

HG Infra (HG) reported revenue/EBITDA/APAT astatine INR 11/2/1bn (missing)/beating our estimation by (1.9)/2/1.4% resp. It expects FY23 gross maturation of 25% positive (INR 46bn) with an EBITDA borderline of 15% positive connected the backmost of a robust OB of INR 110bn. It reported an aboriginal completion bonus of INR 160mn successful Q3FY23 and expects INR 45mn successful Q4FY23. The bid inflow (OI) successful 9MFY23 was INR 60bn with different INR 30-40bn expected successful Q4FY23. It is L1 successful its archetypal non-highway task i.e. Delhi Metro task worthy INR 4bn with the scope of enactment including the operation of an elevated viaduct and 4 elevated stations. It expects a borderline of 14% from this task and a borderline of 15% positive astatine the aggregate level, going forward.

Outlook

The institution plans to monetise 4 HAM projects astatine a ~40% premium to publication worth of INR 3.5bn invested equity by Sep’23. Given robust bid inflow and beardown execution, we support BUY, with an accrued TP of INR 1,017 (14x Dec-24E EPS) to origin successful a higher level of execution and amended EBITDA margin.

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HG Infra - 10 -02 - 2023 - hdfc