The stock of infrastructure company Punj Lloyd has gained 5 per cent in trade so far in an otherwise listless market led by the improving picture of its order pipeline. The latest is the Rs 666-crore order from the Road Transport Ministry to upgrade and widen a 90 km stretch of the Asian Highway network.

Improving picture

This takes the total order inflows this year to a strong Rs 10,606 crore. The total order book now stands at Rs 24,021 crore, well above the Rs 22,000 crore-odd crore levels the order book was at in the two earlier fiscals.

It is also a significant order in the domestic road segment, with most of Punj Lloyd’s road orders being executed overseas.

The building and infrastructure segment in the Middle East-Caspian-African regions currently account for lion’s share of the order book at about 42 per cent, followed by oil pipelines and tankage. With the domestic infrastructure segment picking up, Punj Lloyd can see more such wins in the roads space, besides metro rails and sanitation and sewerage projects.

The recent road order is also on the pure construction basis (engineering procurement construction) which involves lower capital investment than those taken on as a developer. Further, with this being funded by the Asia-Pacific regional development arm of the United Nations, payment delays are not an issue. Revenues for Punj Llyod had been held up over payment delays, especially in the domestic market.

Financials

Standalone interest cost rose 12.5 per cent in the recent September quarter, building on a 21 per cent rise in the June quarter. Standalone revenues have been falling 21 to 50 per cent in the past three quarters, having been flat in the 2013-14 fiscal. The company makes losses at the net level.

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