Man Infraconstruction, which had closed yesterday at Rs.84.70, opened slightly higher today at Rs.85.90, rising to an intraday high at Rs.87.90, not too far from its 52-week high of Rs.89.40. Profit booking has since then pushed the stock into the red, currently trading in the red at Rs.84.60.
The stock price initially reacted to the positive news from the company - the release of Rs358 crore plus accrued interest by the Bombay High Court towards Arbitration Award in favour of subsidiary, Manaj Tollway.
This receipt of money is good news and arbitration awarded in March 21 for Rs.380 crore.
CARE Ratings had upgraded its rating for the stock recently on these factors:
Positive Factors- Factors that could lead to positive rating action/upgrade: · Growth in its order book resulting in revenue visibility of more than 3 times of its total operating income (TOI) and successful execution thereof on a sustained basis. · Improvement in the customer advances resulting in minimum Quarterly Cash Coverage Ratio (CCR) above 1.50x. · Committed receivables as a % of pending project cost & debt outstanding improves to more than 90%
Negative Factors- Factors that could lead to negative rating action/downgrade: · Achievement of lower than anticipated collections leading to deterioration in CCR below 1.25x. · Deterioration in overall gearing (including corporate guarantee extended) above unity. · Deterioration in liquidity (free cash & bank balance goes below Rs.100 crore) on consolidated basis