Emkay Global recommends HG Infra with a “BUY” rating

Team BL Updated - July 10, 2024 at 08:22 AM.

Additionally, HGIEL’s expansion into railways, solar, and water sectors further strengthens its mid-term growth prospects.

HG Infra’s transformation from a small subcontractor to a diversified infrastructure player has yielded best-in-class operating and financial metrics, positioning it for significant growth.

Emkay Global has re-initiated coverage on HG Infra Engineering Ltd. (HGIEL) with a BUY rating and a target price (TP) of ₹2,100 per share.

HGIEL has evolved from a small subcontractor into a diversified infrastructure player, boasting excellent operating and financial metrics that have fuelled its rapid, stress-free growth.

While HGIEL’s core road segment faced an order slowdown in FY24 due to pre-election uncertainty and issues with the Ministry of Road Transport and Highways (MoRTH) and the National Highways Authority of India (NHAI), the government’s Vision India@2047 plan is expected to rejuvenate order flows post-elections.

Management projects ₹12,000 crore in total inflows for FY25, a significant increase from ₹4,500 crore in FY24. Additionally, HGIEL is expanding into the railway sector, focusing on high-speed corridors, freight, and station upgrades, which should support mid-term growth. The company is also exploring opportunities in solar and water projects, having secured ₹1,300 crore worth of orders under the Kusum solar scheme.

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Published on July 10, 2024 02:52
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