The upward momentum followed an announcement of a major milestone: the civil construction firm secured a Provisional Completion Certificate (PCOD) for a significant project, two months ahead of its scheduled deadline.

Major Project Milestone Achieved

PNC Infratech's achievement relates to the four-laning of NH 530B, a 33.018 km stretch from Gaju Village to Devinagar Bypass in Uttar Pradesh, completed under the HAM (Hybrid Annuity Model) mode. The project, valued at Rs 738 crore, was completed well ahead of schedule.

This early completion makes the company eligible for an early completion bonus of Rs 1,428 crore, payable by the National Highways Authority of India (NHAI) along with the first annuity.

Financial Setbacks Weighing on Performance

Despite this milestone, PNC Infratech has faced challenges. The company reported a 43.92% drop in consolidated net profit for the second quarter of FY25, with profits falling to Rs 83 crore, down from Rs 148 crore in the same period last year.

Revenue from operations also declined by 25.33% to Rs 1,427 crore, compared to Rs 1,911 crore in Q2 FY24. Operating profit (EBITDA) fell 11% to Rs 356 crore, reflecting the broader challenges in the sector.

Ministry of Roads’ Restrictions

Adding to the financial strain, the Ministry of Road Transport and Highways (MoRTH) recently disqualified PNC Infratech and its subsidiaries from participating in new tender processes for a year, starting October 18, 2024. This restriction has impacted investor sentiment, contributing to the stock's underperformance over the past few months.

Promoters’ Stake and Future Outlook

Promoters maintain a 56.07% stake in the company, signaling confidence in its long-term potential. The recent milestone could pave the way for improved sentiment, with the early completion bonus offering a significant financial boost.