HCC rises and falls

HCC is having a pretty volatile run today. It opened almost 10% higher at Rs.7.41 but from there, slumped over 6.5% to Rs.6.29 and is currently trading at Rs.6.46 levels, down 4%.

The company ended Q1FY21 with a consolidated net loss of Rs.409 crore on a 40% drop in total revenue at Rs.1690 crore.

The company said that its revenue was impacted by the nation-wide lockdown, resulting in halting of construction, non-availability of labour and disruption in supply chain.

Despite lower turnover, the company has maintained its EBIDTA margins in Q1 FY21 to 24.9% compared to 19.7% in the corresponding period last year.

The Company has recorded an exceptional loss of Rs.242 crore, on account of conciliating an NHAl Award for Rs.219 crore. This was done to generate immediate liquidity in operations given the difficulties presented by COVID.

The company has registered order backlog of Rs.16,558 crore at the end of Ql FY21.

Three projects worth Rs.7,402 crores were won in joint venture in July and August; HCC's share of Rs. 3,337 crore will be reflected in the order book in the next quarter.

The new project wins included Rs.1,900 crore NHAl order to construct a 22 km highway link between Jharkhand and Bihar, Rs.4,167 crore contract for Bhadbhut barrage in Gujarat and Rs.1,335 crore Rail Vikas Nigam order to construct 8.04 km BG rail line between Rishikesh and Karanprayag in Uttarakhand.

And it was this news which led to the spike up in the stock price earlier.

The debt carve-out resolution plan with lenders is expected to conclude in Q3 FY21. Certain amendments to the plan in favour of the Company have received in-principle approval by lenders. These include the utilisation of Rs.1,250 cr of funds from monetisations/claims towards operations and working capital, and a more balanced moratorium on HCC's remaining debt to account for COVID-19.