PNC Infratech Consolidating Below ₹335 Breakout May Unlock 25% Upside Potential: SEBI RA Rajneesh Sharma

Shares of PNC Infratech rose nearly 3% on Friday after the company won a bid to construct a high-level bridge and an approach road in Bihar for ₹495.54 crore.

The stock pared some of the gains to close 2% higher at ₹311.15 on Friday. It has shed around 6.3% so far this year.

According to a press release dated September 5, PNC Infratech emerged as the lowest bidder for a tender floated by the Bihar State Road Development Corporation (BSRDC) for the construction of a high-level bridge and approach road on the Hathouri–Atrar–Bavangama–Aurai Road.

Technical Take

On the charts, PNC Infratech appears to be in a classic accumulation zone. Prices have been moving sideways within a tight range, with major resistance at ₹335.80 repeatedly tested, while strong support holds at ₹247 - ₹260, according to SEBI-registered analyst Rajneesh Sharma.

Momentum indicators suggest quiet strength, with the Relative Strength Index (RSI) making higher lows even as price action remains flat, while the on-balance volume (OBV) steadily rises, pointing to accumulation, Sharma said.

Crucially, the downtrend line from the 2024 peak has been broken, signaling an end to the bearish phase. 

A weekly close above ₹335.80 with strong volumes could trigger a breakout, opening targets of ₹370 and later ₹410 - ₹420. On the downside, risks appear limited unless ₹283 - ₹260 breaks with volume, the analyst said.

The company's new ₹495.5 crore road and bridge project expands its robust ₹17,096 crore order book. This provides revenue visibility of 3.1x FY25 topline, he added. 

PNC Infratech is involved in multiple projects, including the Jalna - Nanded highway for ₹2,289 crore, Pune Ring Road for ₹2,239 crore, and CIDCO Infra for ₹2,040 crore. 

The balance sheet is lean with a debt-to-equity ratio of just 0.07x. Additionally, asset monetization worth ₹1,827 crore and expected receivables of ₹200 crore strengthen cash flows for future bids. With execution capacity primed for ₹10,000 - ₹12,000 crore topline, the company looks well-positioned for growth, Sharma stated.

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