PNC Infratech Faces Setback: Shares Hit 20% Lower Circuit After One-Year Ban from Tenders

Shares of PNC Infratech fell sharply, hitting the 20% lower circuit limit at Rs 366 on October 21, following a disqualification from participating in tenders issued by the Ministry of Road Transport & Highways. The ban is effective for one year, starting from October 18, 2024, and it also applies to its subsidiaries, PNC Khajuraho Highways and PNC Bundelkhand Highways.

This disqualification comes after the company was summoned for a personal hearing related to a FIR and charge sheet filed by the CBI in June and August 2024. Despite this setback, PNC Infratech reassured investors that its ongoing development, construction, and operations and maintenance activities will remain unaffected. The company plans to evaluate any potential impacts on other operations and will communicate any findings to its stakeholders.

In the midst of these challenges, PNC Infratech has managed to secure two significant orders from the Maharashtra State Road Development Corporation, totalling Rs 4,630 crore. The first project, worth Rs 2,268 crore, involves building the access-controlled Pune Ring Road, while the second contract, valued at Rs 2,362 crore, focuses on constructing a connector expressway to the Hindu Hrudaysamrat Balasaheb Thackeray Maharashtra Samruddhi Mahamarg from Jalna to Nanded. Both projects are expected to be completed within 30 months under the engineering, procurement, and construction (EPC) model.

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Over the past three months, PNC Infratech's stock has dropped more than 27%, underperforming compared to the Nifty 50 index, which saw gains during the same period. Out of 16 brokerages monitoring the stock, 12 have given a 'buy' rating, 3 have a 'hold' rating, and 1 has issued a 'sell' rating.

[Disclaimer: The information provided in this blog is for informational purposes only and should not be considered financial advice. Please consult a financial advisor before making any investment decisions.]