Shares of PNC Infratech soared 5% on March 15 after the company was announced as the lowest bidder for the Rs 1,260 crore highway project.

The project is under the mixed annuity model of the National Highways Authority of India (NHAI) to construct a six-lane greenway Varanasi-Ranchi-Kolkata from Pachmon village to Anarbansalea village under Bharatmala Pariyojana in Bihar on March 14, 2023, Expressway, the company said in a regulatory filing.

PNC Infratech said the project would be completed within 24 months and operate for 15 years after completion.

Shares of the company were trading 3% higher at Rs 293.25 at 9:30 am on the BSE.

“With no order inflow during the nine months of FY23 due to intense competitive bidding and weak industry tenders, winning orders is critical,” said BNP Paribas’ Sharekhan.

Sharekhan said that in January 2023, road project incentives and construction activity increased with a month-on-month (MoM) growth of 2.2 and 2.6 times, respectively. The brokerage firm expects many project awards for the March quarter.

 The brokerage said the order book till December 2022 remained healthy at Rs 17,842 crore, 2.6 times trailing 12-month stand-alone revenue, while recent new orders received will help growth in FY24 and FY25.

It seems the risk-reward ratio favours PNC Infratech, one of the key beneficiaries of the sector’s positive outlook. The brokerage has a ‘buy’ call on the stock with a target price of Rs 390.