IDBI Capital Maintain "Buy" On Small Cap Infra Stock, Sees 39% Upside, Gave 389% Return In 3 Yrs

Brokerage firm IDBI Capital maintains its bullish outlook on small-cap Infra sector stock H.G. Infra Engineering Ltd. The brokerage has a "Buy" on the stock with a target price of Rs 1,067 apiece. It sees a strong potential upside of up to 39% if purchased at the current market price. HG Infra is an Indian Road Infrastructure Company engaged in the business of Engineering, Procurement and Construction Services, Maintenance of roads, flyovers, bridges, and other infrastructure contract works. It has a market capitalisation of Rs 5,010.03 crore.

HG Infra's Stock Outlook

The stock's current market price is Rs. 768.75 apiece. Its 52 week high is Rs. 824 apiece, recorded on 23 March 2023. It is currently trading 6.71% down from its recently hit52 week high. It recorded 52 week low on 11 May 2022 at Rs 508.05 apiece. The stock has given 0.76% negative return in the past 1 week. However, it has given a positive return of 8.82% in 1 month and 37.26% in 3 months, respectively. It has given 36.67% positive return in the past 1 year. In 3 years, it has given a strong 388.72% positive return. In the past 5 years, it has given 159.14% positive return.

Ganga expressway on track, buy for a target price of Rs 1,067 apiece

IDBI Capital has said, "We visited HG Infra's (HGEIL) Ganga expressway project site and interacted with the execution team and management. HG Infra was awarded Ganga expressway project, a 6 lane greenfield access controlled expressway of 151.7km in Q1FY23, with project cost of Rs44bn. The schedule completion time is 27m post appointed date of 3rd Nov'22 i.e. Jan'25, though company is planning on early completion in 24 months post which they will be eligible for early completion bonus of Rs500mn. Revenue growth guidance is maintained with target of growing ~22% YoY in FY24E, of which 1/3rd is expected to come from Ganga expressway project. Company is eyeing order inflow of Rs80-100bn in FY24E, of which ~60-70% is expected from highway projects and 30-40% is expected from other segments. Maintain BUY rating with TP of Rs1,067."

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