Ashoka Buildcon announced its Q1FY22 results earlier this week. The company is largely into highway development in the country working under all three models – EPC, BOT and HAM.

The company has 39 PPP projects which are the most by any private player. The company also executed EPC contracts in the power transmission and distribution space. Ashoka Buildcon has been looking for opportunities even outside the country, executing its first project in the Maldives.

The company has reported a revenue jump of 65% YoY to Rs. 1310 crore. EBITDA has also grown significantly on a low base of Q1FY21 to Rs. 424 crore – up 52% – with margins coming in at 32.3%. reported PAT was at Rs. 79.5 crore vs a loss of Rs. 37.7 crore in the corresponding quarter of the previous year.

The order book continues to remain strong at Rs. 9472 crore. Debt though has risen to Rs. 6241 crore. The months of April and May saw labour shortages to the tune of 30% which have now levelled off post-re-opening.

We spoke with Mr Paresh Mehta, CFO of Ashoka Buildcon to better understand how the industry and company have been shaping up post wave 2. Mr. Mehta re-iterated that March was a stronger quarter than Q1FY22 due to wave 2 in April and May. However, the capacity post-May has improved back to 80-85% levels.

NHAI has already rolled out orders this year with Ashoka Buildcon having an order book of around 10,000 crore till date. Mr. Mehta believes that Ashoka Buildcon will win orders worth an additional Rs 3,500 to Rs 4,000 crore this fiscal and end the year with revenues 20% higher than FY21.

He suggested that the company will continue to maintain margins of 12-12.5%. He believes inflation risks are low for the company, especially for HAM projects. Lastly, Mr. Mehta also spoke about divestitures. He says the company is in advanced stage talks on giving SBI-Macquarie an exit and is focused on monetizing assets.

The stock of Ashoka Buildcon has been on the decline, falling 12.8% in the last month but up 15.81% in the last 3 months.