Ashoka Buildcon surges 8% after Co emerges lowest bidder for NHAI projects
Shares of Ashoka Buildcon surged 8 per cent to Rs 73.45 in the early morning trade on the BSE on Tuesday after the company emerged as the lowest bidder for two National Highways Authority of India (NHAI) projects with an aggregate quoted value of Rs 1,390 crore in Bihar under Bharatmala Pariyojana.
The company, which is engaged in the construction of roads and highway projects, said the first project comprises a proposal for the four laning of Arrah to Pararia section of NH-319(Old NH-30) from Km 0+000 to Km 54+530 (Design Chainage) in Bihar under Bharatmala Pariyojana phase -1 on EPC mode (Package-I).
The second project is a request for the proposal for four laning of Pararia to Mohania section of NH-319(Old NH-30) from Km 54+530 to Km 115+330 (Design Chainage) in the state under Bharatmala Pariyojana Phase-I on EPC Mode (Package II), it said.
The Union Minister for Road Transport & Highways and MSMEs, in his communication dated April 07, 2020, had set a target of constructing roads worth Rs 15 lakh crore over the next two years.
Ashoka Buildcon expects many opportunities in the near and long term for the infrastructure sector in India. The government’s ambitious infrastructure development programme provides significant opportunities to boost economic development in the sector in the coming years.
With relaxation in the lockdown restrictions, the construction activity has resumed at major project sites by following the social-distancing norms and other health and hygiene measures. The operations are ramping up gradually across the sector.
The economic activity has started to pick up the pace with toll collections also beginning to limp back to normalcy. Toll revenues have gradually revived to reach over 70-75 per cent pre-COVID levels, led by improving commercial traffic even when many cities or state sections are not allowing traffic movement freely, and expect to reach pre-COVID collections in the coming months, the company said.
“The company’s order book – which is Rs 8,981 crore, ensures strong visibility for the EPC (engineering, procurement, and construction) segment for foreseeable future. The management is well confident and also geared up to win BOT (build, operate, transfer)/ HAM (hybrid annuity model) projects in the upcoming bids, which will ensure a steady growth in execution as well as our revenues in the long term,” Ashoka Buildcon said in FY19-20 annual report.
At 09:56 am, the stock was trading 7 per cent higher at Rs 72.65 on the BSE, as compared to a 0.19 per cent rise in the S&P BSE Sensex. The counter has seen huge trading volumes with a combined 1.1 million equity shares changing hands on the NSE and BSE so far.