Stocks with order books higher than market capitalization highlight companies where the total value of confirmed orders exceeds their current market value. This scenario often indicates strong future revenue potential, suggesting that the company may be undervalued by the market.
Such stocks can be attractive to investors, as a robust order book provides visibility into future earnings, enhancing the company’s growth prospects. This article explores firms with significant order books relative to their market capitalization, offering insights into their business performance and investment potential.
1. H.G. Infra Engineering Limited:
H.G. Infra Engineering Limited is a leading infrastructure development company in India, specializing in EPC (Engineering, Procurement, and Construction) projects. With a le market cap of ₹ 8,603 Cr., the company has established itself as a key player in infrastructure development. H.G. Infra focuses on projects across various segments, including highways, railways, metros, and solar power.
Share Price
H.G. Infra Engineering Limited share price: Shares of H.G. Infra Engineering Limited are trading at Rs.1,320, 0.8% lower from its previous close of Rs. 1330 at 03:02 pm on Tuesday, November 05, 2024.
Order Book
Looking at H.G Infra’s order book for June 2024, the company shows a strong position with Rs. 11,452.3 crore in Roads & Highways, Rs. 2,498.0 crore in Railways & Metro, and Rs. 1,691.5 core in Solar projects. Maharashtra leads with 33% of orders, followed by Jharkhand at 15%.
The portfolio includes diverse projects like the Karnal-Munak Road and Varanasi-Ranchi Kolkata Highway. Most highway projects show healthy completion rates above 50%. Railway projects, though at lower completion levels (1.9-29.3%), include significant works like the Kanpur Central Railway. The solar segment features a major Rajasthan KUSUM project at 4% completion.
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2. Ircon International Limited
Ircon International Limited is a prominent Indian engineering and construction company with over 45 years of expertise in transportation infrastructure. Specializing in railway and highway projects, the company has built a strong reputation both domestically and internationally.
With a market capitalization of ₹19,972 crore, the company excels in delivering complex projects across various segments, including railways, highways, bridges, tunnels, and metro systems. Ircon’s commitment to innovation and quality has positioned it as a key player in the infrastructure sector, driving development and connectivity worldwide.
Share Price
Ircon International Limited share price: Shares of Ircon International Limited are trading at Rs. 212, 1% higher from its previous close of Rs. 209.93 at 03:20 pm on Tuesday, November 05, 2024.
Order Book
The order book reveals railways dominating with a 78.4% share (Rs. 20,420 crore), while highways contribute 21.2% (Rs. 5,531 crore). Small miscellaneous orders make up 0.4% (Rs. 83 lakhs). Looking at geography, domestic orders lead heavily at 90.7% (Rs. 23,604 crore), with international business at 9.3% (Rs. 2,430 core).
The business split between bidding and nomination stands nearly equal – bidding at 49.3% (Rs. 13,193 crore) and nomination at 50.7% (Rs. 12,841 crore). Total order book value reaches Rs. 26,034 crores, with competitive bidding securing roughly half the business.
Conclusion
In conclusion, it will be an interesting watch to keep track of these two stocks in the coming years. Only time will reveal how these stocks perform in the future as both companies look to have steady cash flow for the coming years. These types of stocks could be great for long-term investments considering the Indian economy is going through a massive infrastructure boom.
Written By: Dipangshu Kundu
Disclaimer
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