⚡ At a Glance
Ashoka Buildcon is a road warrior, railway contractor, and rural electrification champ all rolled into one. With 61% 5Y PAT CAGR, ROE of 55%, and a PE ratio of just 3.5x, it looks like a value investor’s fantasy. So… what’s the catch?
1. 🎬 Introduction with Hook
How do you describe a company that has built 14,000+ lane-km of highways, electrified 30,000+ villages, and now has projects in Guyana?
You call it “Ashoka Buildcon” — or, as the stock market calls it:
“That infra stock with a P/E ratio lower than your Uber ride fare.”
But here’s the kicker: the company’s profit is up 3x in 3 years, ROCE is nearing 40%, and yet the stock’s trading like it committed fraud. Time to dig under the road layers.
2. 🏭 WTF Do They Even Do? (Business Model)
Ashoka Buildcon is an EPC contractor + BOT toll operator + urban infra builder.
- Construction Contracts (63% of FY25 revenue):
- Roads, highways, expressways (NHAI, MORTH)
- Railways (track laying, OHE electrification)
- Power T&D projects
- Urban flyovers, buildings, optical fiber
- BOT/HAM Projects: Owns and operates toll roads under subsidiaries like Ashoka Concessions.
- Global Foray: Won a $67.25M project in Guyana in June 2025.
So yes, it’s not just infra-wala anymore. It’s infra-with-exports.
3. 📈 Financials Overview – Profits, Margins, ROE, ROCE
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue (₹ Cr) | 8,100 | 9,798 | 10,037 |
| Net Profit (₹ Cr) | 294 | 521 | 1,734 |
| EBITDA Margin (%) | 24% | 23% | 29% |
| ROCE (%) | 28% | 27% | 40% |
| ROE (%) | 37% | 38% | 55% |
| EPS (₹) | 10.42 | 17.92 | 60.35 |
🚀 PAT grew 3x in 2 years. And margins? They’ve shot up thanks to project completion, better cash flows, and de-leveraging.
4. 🧮 Valuation – Is It Cheap, Meh, or Crack?
| Metric | Value |
|---|---|
| CMP | ₹214 |
| TTM EPS | ₹60.35 |
| PE Ratio | 3.54x |
| Book Value | ₹139 |
| Price / Book | 1.53x |
| ROE | 55.2% |
| Fair Value Range™ | ₹300 – ₹420 (at 5x–7x EPS) |
🧠 Even at 6x earnings (half of L&T’s PE), this should trade at ₹360+. That’s 70% upside from CMP — IF earnings sustain.
5. 🔥 What’s Cooking – Orders, Announcements, Triggers
🚧 Big News in 2025:
- June 2025: Won ₹560 Cr Guyana road project
- June 2025: Won 10-year traffic contracts in Maharashtra
- June 2025: Issued Commercial Paper at 7.6% (shows cash flow confidence)
- May 2025: Fully repaid earlier CP on time
📣 Upcoming Triggers:
- Ashoka Concessions stake sale monetization
- More overseas projects (Middle East, Guyana, Africa)
- Government infra push: NHAI, Railways, Smart Cities
6. 💪 Balance Sheet – How Much Debt, How Many Dreams?
| Metric | FY25 |
|---|---|
| Total Borrowings | ₹1,988 Cr (down from ₹5,450 Cr in FY24) |
| Equity | ₹140 Cr |
| Reserves | ₹3,775 Cr |
| D/E Ratio | ~0.5x (de-leveraged fast) |
| Total Assets | ₹20,770 Cr |
🧹 From ₹6,000 Cr+ debt to just ₹2,000 Cr — that’s called cleaning house.
7. 💵 Cash Flow – Sab Number Game Hai
| Metric | FY24 | FY25 |
|---|---|---|
| Operating Cash Flow | ₹749 Cr | ₹1,673 Cr 🚀 |
| Investing Cash Flow | ₹234 Cr | -₹626 Cr |
| Financing Cash Flow | -₹407 Cr | -₹1,052 Cr |
| Net Cash Flow | ₹575 Cr | -₹4 Cr |
Even after massive debt reduction, they generated ₹1,673 Cr from operations.
8. 📊 Ratios – Sexy or Stressy?
| Ratio | FY25 |
|---|---|
| ROCE | 40% |
| ROE | 55.2% |
| OPM | 29% |
| Debt/Equity | 0.5x |
| Working Capital Days | 56 |
| CCC | 18 days |
These are elite ratios for infra. The 29% EBITDA margin is unusually high for EPC — thanks to BOT income and high-value contracts.
9. 📋 P&L Breakdown – Show Me the Money
| Line Item | FY25 |
|---|---|
| Revenue | ₹10,037 Cr |
| Op. Expenses | ₹7,117 Cr |
| EBITDA | ₹2,920 Cr |
| EBITDA Margin | 29% |
| Interest | ₹1,245 Cr |
| Depreciation | ₹290 Cr |
| PBT | ₹1,555 Cr |
| Tax (–12%) | -₹186 Cr (MAT credit or reversal) |
| PAT | ₹1,734 Cr |
| EPS | ₹60.35 |
📉 Negative tax due to one-off reversal. Adjusted EPS is likely closer to ₹45–50 if normalized.
10. 👑 Shareholding, Promoters & KMP
| Shareholder Type | Mar 2025 |
|---|---|
| Promoters | 54.47% |
| FIIs | 7.48% (rising 🚀) |
| DIIs | 14.93% (slightly falling) |
| Public | 23.12% |
📢 FII stake tripled in the last 6 quarters (from 2.4% to 7.5%). Smart money loading up?
11. 🧠 Fair Value Range – EduMath™
- Sustainable EPS: ₹50 (conservative)
- PE Band: 5x–7x (infra range)
- Fair Value: ₹250 – ₹350
- Optimistic EPS: ₹60 → FV ₹300 – ₹420
🚨 CMP = ₹214. Even bottom range is higher than CMP. Market is definitely undervaluing.
12. ✅ EduInvesting Verdict™
✅ Pros:
- Insanely low P/E
- 61% 5Y profit CAGR
- Debt sharply reduced
- High ROE, ROCE
- Overseas expansion
🚫 Cons:
- Infra sector = lumpy revenues
- Negative tax = one-off
- No dividend
- Valuation could remain compressed if market ignores infra
🎯 Final Take:
This stock is undervalued, underhyped, and overdelivering.
If you believe India is going to keep building roads, metros, railways, and exporting infra expertise — Ashoka Buildcon might be your next hidden compounder.
✍️ Written by Prashant | 📅 June 26, 2025
Tags: Ashoka Buildcon, Infra stocks, EPC companies, Roads, BOT, HAM, Guyana, Value stocks, ROE 50% club, PSU contracts
