Rs 18,568 Crore Order Book: Low PE, High ROCE Civil Construction Company Secures Rs 2,150 Crore Highway Orders in Arunachal Pradesh

Ceigall India, jointly with Sushee Infra Mining Limited, has received four Letters of Acceptance (LOAs) from the Ministry of Road Transport & Highways (MoRTH) for road construction projects in Arunachal Pradesh. Ceigall India holds a 74 per cent stake in the joint venture, while Sushee Infra Mining holds the remaining 26 per cent. The four projects have an aggregate bid cost of Rs 2,149.62 crore.

The company is currently trading at a PE ratio of 16.7, while its ROCE stands at 17.3 per cent, indicating its current valuation and return on capital employed.

Four Highway Projects Worth Rs 2,149.62 Crore

The contracts have been awarded by MoRTH under the Engineering Procurement Construction (EPC) mode and are domestic projects. The four projects cover different stretches of NH-913, also known as the Frontier Highway, in the state of Arunachal Pradesh.

The first project involves construction of the Huri-Taliha section from km 0.000 to km 55.725, with a bid cost of Rs 521.00 crore. The second project covers construction of the Sarli-Huri section from km 0.000 to km 78.38, with a bid cost of Rs 611.10 crore.

The third project involves construction of the Huri-Taliha section from km 55.725 to km 113.25, carrying a bid cost of Rs 525.00 crore. The fourth project covers the Huri-Taliha section from km 160.75 to km 209.90, with a bid cost of Rs 492.52 crore.
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Execution Period Up to 48 Months

The projects have different construction timelines. The first, second and fourth projects have a 36-month construction period followed by a five-year maintenance period, while the third project carries a 48-month construction period followed by a five-year maintenance period.

The contracts are being executed through the joint venture between Ceigall India and Sushee Infra Mining, with Ceigall India holding the majority 74 per cent stake in the JV.

Share Price Performance

On Tuesday, Indian equity benchmark indices traded lower, with the Nifty 50 index declining 0.33 per cent to 24,207.25. Amid the market movement, Ceigall India shares were trading at Rs 305.45, down 3.32 per cent.

The company's latest disclosure adds four large-scale highway projects to its project pipeline, with an aggregate bid cost of Rs 2,149.62 crore. The contracts cover road construction under the Frontier Highway project in Arunachal Pradesh, with execution and maintenance extending over multiple years.

About Ceigall India

Ceigall India Ltd is engaged in the infrastructure and road construction business. Through the latest joint venture with Sushee Infra Mining, the company has secured four MoRTH LOAs for construction of sections of NH-913 in Arunachal Pradesh. The projects have a combined bid cost of Rs 2,149.62 crore and include construction as well as subsequent maintenance obligations.

The Rs 2,149.62 crore aggregate bid cost, the four MoRTH contracts and the multi-year construction and maintenance periods remain key developments to track for Ceigall India.

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Disclaimer: The article is for informational purposes only and not investment advice.