Brokerages lowered their earnings estimates following muted results in Q1FY24.
While analysts remain optimistic about the stock s medium-term prospects, they highlight near-term concerns stemming from lower realisations due to changes in the product mix and margin pressures resulting from new plane additions.
Brokerages upbeat on EPC stocks post budget
Brokerages upbeat on EPC stocks post budgetPremium
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Mumbai: The increases in budgetary allocations for the infrastructure sector, including roads, railways, water supply programmes and healthcare, bodes well for engineering-procurement-construction (EPC) companies operating in these segments. Faster payments settlements from central agencies such as the national highways developer, improvement in project execution rates and a now-reliant inflow of government projects have also led to a re-rating of equity of many listed infra players.
For FY22, the central government has budgeted for a 26% increase in capital spending, hoping that its multiplier effect and resulting job creation will bring the gross domestic product (GDP) close to its projected 11% growth rate next fiscal year.