1. At a Glance
A 98-year-old infra juggernaut with more national projects than a cabinet minister’s to-do list, HCC has built tunnels, dams, and a surprisingly resilient investor base. But behind the grand bridges lies a story of high debt, vanishing margins, and a PE that looks like a printer error.
2. Introduction with Hook
If Indian infrastructure was a Bollywood action film, HCC would be the grizzled veteran who built the sets, trained the stunt team, and still didn’t get paid on time.
- PE: 716x (not a typo. Not a feature. A warning.)
- Market Cap: ₹5,296 Cr, with dreams taller than their bridges.
Once the builder of India’s power backbone, today it’s trying to reconstruct its own balance sheet.
3. Business Model (WTF Do They Even Do?)
HCC is the OG of Indian infra:
- Over 60% of India’s nuclear power infra
- 26% of hydropower capacity
- 4,036 lane km of roads
- 395 bridges
- 360 km of tunneling magic
Revenue comes from:
- EPC Contracts (Engineering, Procurement, Construction)
- JV Projects (e.g., Indore Metro, Tata Power orders)
- Overseas ops (Steiner AG – now divested)
But also:
- High receivables
- Debt restructuring
- Legal claim recoveries masquerading as profits
4. Financials Overview
| Metric | FY25 | FY24 | FY23 |
|---|---|---|---|
| Revenue | ₹5,603 Cr | ₹7,007 Cr | ₹8,270 Cr |
| EBITDA | ₹634 Cr | ₹671 Cr | ₹548 Cr |
| Net Profit | ₹113 Cr | ₹478 Cr | ₹-28 Cr |
| EPS | ₹0.62 | ₹2.85 | ₹-0.17 |
| OPM | 11% | 10% | 7% |
Trend:
Sales shrinking like cheap cement in rain. Margins improving but mostly due to claim settlements and accounting miracles.
5. Valuation
- CMP: ₹29.1
- PE: 716x (aka “please explain”)
- Book Value: ₹4.98
- Price/Book: 5.85x
Fair Value Estimate (Based on recovery + operating cash flow potential):
- Bear Case: ₹12
- Base Case: ₹22
- Bull Case: ₹35
FV Range: ₹18 – ₹30
Valuation is all smoke and receipts — largely dependent on future awards, claim settlements, and debt servicing discipline.
6. What’s Cooking – News, Triggers, Drama
- Leadership Shuffle: CEO Jaspreet Bhullar exits June 2025. Arjun Dhawan becomes MD. Boardroom construction ongoing.
- Rs 1,500 Cr Fundraise Approved (May 2025) – praying the cement doesn’t set before the cash flows.
- HCC-TPL JV bags Tata Power & Indore Metro orders worth over ₹4,600 Cr – backlog heaven.
- Claim Settlements: Rs 180 Cr recovered from a “major client” – perhaps a euphemism for “finally paid us.”
- Divestment of Steiner AG & Amalgamation of infra subsidiaries – shedding dead weight like a detox cleanse.
7. Balance Sheet
| Item | FY25 | FY24 | FY23 |
|---|---|---|---|
| Equity Capital | ₹182 Cr | ₹151 Cr | ₹151 Cr |
| Reserves | ₹724 Cr | ₹-320 Cr | ₹-866 Cr |
| Borrowings | ₹1,679 Cr | ₹2,223 Cr | ₹5,512 Cr |
| Total Assets | ₹8,088 Cr | ₹9,059 Cr | ₹13,178 Cr |
Key Notes:
- Net worth finally positive after years in the red.
- Debt reduction is real, but still heavy.
- De-leveraging efforts starting to show, but interest still eats into P&L like termites.
8. Cash Flow – Sab Number Game Hai
| Type | FY25 | FY24 | FY23 |
|---|---|---|---|
| Operating CF | ₹134 Cr | ₹91 Cr | ₹16 Cr |
| Investing CF | ₹-35 Cr | ₹536 Cr | ₹448 Cr |
| Financing CF | ₹109 Cr | ₹-810 Cr | ₹-603 Cr |
| Net Flow | ₹208 Cr | ₹-183 Cr | ₹-139 Cr |
Decoded:
- Cash is coming from one-offs, fund raises, and divestments.
- OCF is finally stable, but far from funding large infra without external help.
9. Ratios – Sexy or Stressy?
| Ratio | FY25 | FY24 | FY23 |
|---|---|---|---|
| ROCE | 26% | 21% | 16% |
| ROE | 2% | 2% | -ve |
| Debt/Equity | 2.3x | 6.6x | ∞ (because negative reserves) |
| Debtor Days | 156 | 115 | 119 |
| Inventory Days | 52 | 183 | 179 |
Verdict:
ROCE looks hot, but reality? It’s driven by book gains and financial restructuring. Operational metrics still gasping.
10. P&L Breakdown – Show Me the Money
| Item | FY25 | FY24 | FY23 |
|---|---|---|---|
| Sales | ₹5,603 Cr | ₹7,007 Cr | ₹8,270 Cr |
| EBITDA | ₹634 Cr | ₹671 Cr | ₹548 Cr |
| Interest | ₹600 Cr | ₹813 Cr | ₹1,012 Cr |
| Depreciation | ₹164 Cr | ₹105 Cr | ₹128 Cr |
| Net Profit | ₹113 Cr | ₹478 Cr | ₹-28 Cr |
Translation:
Every rupee earned fights off a rupee of interest. EBITDA growing? Yes. But until interest is under control, it’s treadmill growth.
11. Peer Comparison
| Company | CMP (₹) | PE | ROCE | OPM | Debt/Equity | Promoter Holding |
|---|---|---|---|---|---|---|
| L&T | 3,540 | 32x | 14.5% | 13.4% | 0.2x | 100% |
| IRB Infra | 47.6 | 29x | 7.8% | 45.5% | 2.0x | 34% |
| NBCC | 112.9 | 50x | 33.5% | 5.1% | Debt-free | 61.8% |
| Techno Elec | 1,598 | 49x | 16.5% | 14.9% | 0.1x | 74% |
| HCC | 29.1 | 716x | 25.6% | 11.3% | 2.3x | 16.7% |
Punchline:
Valuation’s a joke. ROCE is inflated. Promoter holding is barely visible through the pledge fog.
12. Miscellaneous – Shareholding, Promoters
- Promoter Holding: 16.72% (with 78.9% pledged – oh joy)
- FII Holding: 10.57%
- DII Holding: 6.85%
- Public Holding: 65.87% (yes, the aam janta is funding this EPC opera)
- No. of Shareholders: 7.3 lakh and counting — half likely hoping for a L&T acquisition.
Management Shake-Up:
- Arjun Dhawan in as MD
- Ex-CEO Jaspreet Bhullar out
- CFO replaced in June 2025
Investor Confidence Level: 404 Not Found
13. EduInvesting Verdict™
HCC is not for the faint-hearted or spreadsheet romantics. This company is where infra ambition meets financial chaos. The debt’s being cleaned, the subsidiaries are merging, and awards are rolling in — but the turnaround is still a story-in-progress, not a done deal.
If HCC were a monument, it would be the Delhi Signature Bridge: bold, iconic, but still waiting for some good foot traffic.
Investors need stamina, nerves of steel, and a tolerance for… well, creative accounting.
Metadata
– Written by EduInvesting | July 14, 2025
– Tags: HCC, Hindustan Construction Company, Infrastructure Stocks, EPC Contractors, Turnaround Story, Debt Restructuring, Indore Metro, India Infra Giants
