Ahluwalia Contracts surges over 6% on securing Rs 1,144-crore order from Signature Global

So far this year, shares of Ahluwalia Contracts have risen over 63 percent

Shares of Ahluwalia Contracts (India) surged over 6 percent to Rs 1,272 on September 10 after securing an order worth Rs 1,144 crore from Gurugram-based realty firm Signature Global Business Park for a group housing project.

The project, titled "De-luxe DXP," will be located in Sector 37D, Dwarka Expressway, Gurugram, and is expected to be completed within a five-year regulatory timeframe.

Spread across 16.65 acres, De-luxe DXP will feature 1,008 units in eight towers, offering 3BHK, 3.5BHK, and 4.5BHK apartments, along with penthouses. The project has a sales potential of approximately 28.12 lakh square feet.

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It is being designed by renowned international architects AEDAS, with landscape design by Sanju Bose, executive architecture by DFI, structural consultancy by Mahimtura, and MEP consultancy by Sanelac. The project is IGBC Gold-rated and will include two clubhouses spanning 80,000 sq. ft, seven swimming pools, podium parking, VRV air conditioning, and four apartments per core.

Signature Global has already delivered 11 million square feet across various projects and has an additional 32.2 million square feet of saleable area in its upcoming projects, along with 16.4 million square feet of ongoing projects.

In the June quarter, Ahluwalia Contracts reported a 20.4 percent year-on-year growth in revenue from operations, reaching Rs 920 crore, driven by accelerated project execution from a strong order backlog. However, profit after tax fell by 38.5 percent YoY to Rs 30 crore, impacted by weaker operating performance and higher interest expenses.

Looking ahead, analysts at SMIFS expect Ahluwalia's revenue to grow at a CAGR of 21.2 percent between FY24 and FY26. However, they revised margin expectations for FY25 down to 9.5 percent due to the company's underwhelming Q1 performance and anticipated ongoing pressure in Q2. Analysts also noted that the stock is trading at a high valuation of 21.2x FY26E P/E, leading to a target price of Rs 1,131 per share and a downgrade in their rating to "sell."

So far this year, shares of Ahluwalia Contracts have risen over 63 percent, significantly outperforming the Nifty 50's 16 percent gain.

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