Power Mech Projects Ltd (NSE:POMP) has secured a significant contract worth INR 579 crore (excluding GST) from Bharat Heavy Electricals Limited (NSE:BHEL) for civil, structural, and architectural works at the 2x800MW DVC Koderma Thermal Power Station (KTPS) Phase-II in Jharkhand.
The company announced the development in a regulatory filing, highlighting that the project includes levelling and grading of the power block area, construction of foundations, service buildings, ventilation systems, fire protection systems, and fencing, among other infrastructure works. The contract has an execution timeline of 32 months from the date of the Letter of Award (LOA).
Power Mech Projects has been consistently strengthening its financial performance. In Q3 FY24, the company reported a 33.3% year-on-year (YoY) increase in net profit, reaching INR 82 crore, compared to INR 61.5 crore in the same period last year.
Revenue grew by 20.8% YoY to INR 1,338 crore, up from INR 1,107.5 crore in Q3 FY24, reflecting strong execution capabilities and demand in the infrastructure sector. Additionally, EBITDA rose by 12.8% to INR 150.9 crore, compared to INR 133.8 crore a year ago. However, the company witnessed a slight dip in its EBITDA margin to 11.3%, down from 12.1%, despite strong revenue growth.
With its latest order win and robust financials, investors are keen to assess whether Power Mech Projects presents an attractive investment opportunity. According to InvestingPro’s Fair Value tool, the stock has a fair value of INR 2,391.7 per share, indicating a 10.2% upside potential from its current market price (CMP) of INR 2,170.1.
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Bottom Line: Power Mech Projects’ latest INR 579 crore BHEL order reinforces its strong market position and growth trajectory. With a potential upside of 10.2%, investors may find the stock appealing, but staying updated with InvestingPro’s fair value assessments can offer deeper insights into the company’s true potential.
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