Check Before You Invest : Hindustan Construction Company Ltd

Q: Which industry/sub-sector does Hindustan Construction Company Ltd belong to?

Hindustan Construction Company Ltd belongs to the Construction & Infrastructure sector, operating specifically within the Engineering - Construction segment.

Q: Is Hindustan Construction Company Ltd a good quality company?

Hindustan Construction Company Ltd is a good quality company, based on a consistently good multi-year financial track record. This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q: Is Hindustan Construction Company Ltd undervalued or overvalued?

Hindustan Construction Company Ltd appears Fair, as its key valuation ratios are in line with their past averages. Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more. Valuation Ratios. Price to Earnings, Current: 26.1, Historic Median: 11.79. Price to Book, Current: 1.74, Historic Median: 4.21. Price to Sales, Current: 1.36, Historic Median: 0.79. EV to EBITDA, Current: 7.98, Historic Median: 7.15

Q: Is Hindustan Construction Company Ltd a good buy now?

Hindustan Construction Company Ltd is a good buy now, based on strong price trend analysis suggesting prices may rise. However, you need to check its quality and valuation before making a decision

Q: Revenue growth of Hindustan Construction Company Ltd?

Hindustan Construction Company Ltd revenue growth is -4.8% for FY-2025, which is below its 5-year CAGR of 5.65%, indicating slower growth.

Q: Gross Profit margin of Hindustan Construction Company Ltd?

Hindustan Construction Company Ltd Gross profit margin which is the profit after deduction of direct costs, is 10.9% for FY-2025, which is above its 5-year median of 2.1%, indicating increasing margins.

Q: Operating Profit Margin of Hindustan Construction Company Ltd?

Hindustan Construction Company Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 19.43% for FY-2025, which is above its 5-year median of 13.64% indicating increasing margins.

Q: Net Profit Margin of Hindustan Construction Company Ltd?

Hindustan Construction Company Ltd Net Profit Margin is 1.77% for FY-2025, is in line with its 5-year median of 1.77%, indicating stable margins. Profitability Metrics. Gross Profit Margin (%), Current: 10.9, Historic Median: 2.1. Operating Profit Margin (%), Current: 19.43, Historic Median: 13.64. Net Profit Margin (%), Current: 1.77, Historic Median: 1.77

Q: Return on Asset of Hindustan Construction Company Ltd?

Hindustan Construction Company Ltd Return on Asset is 1.03%, which is in line with its 5-year historical median of 1.03%, indicating stable asset utilization efficiency.

Q: Return on capital employed (ROCE) of Hindustan Construction Company Ltd?

Hindustan Construction Company Ltd Return on capital employed is 31.79% for FY-2025, which is in line with its 5-year historical median of 31.79%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 14%, indicating value creation.

Check Before You Invest : Hindustan Construction Company Ltd

Snapshot

Q.1 Which industry/sub-sector does Hindustan Construction Company Ltd belong to?

Hindustan Construction Company Ltd belongs to the Construction & Infrastructure sector, operating specifically within the Engineering - Construction segment.

Q.2 Is Hindustan Construction Company Ltd a good quality company?

Hindustan Construction Company Ltd is a good quality company, based on a consistently good multi-year financial track record.

This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q.3 Is Hindustan Construction Company Ltd undervalued or overvalued?

Hindustan Construction Company Ltd appears Fair, as its key valuation ratios are in line with their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios	Current	5-year Historic Median
Price to Earnings	26.1	11.79
Price to Book	1.74	4.21
Price to Sales	1.36	0.79
EV to EBITDA	7.98	7.15

Q.4 Is Hindustan Construction Company Ltd a good buy now?

Hindustan Construction Company Ltd is a good buy now, based on strong price trend analysis suggesting prices may rise. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

How has it performed on generating Profits?
By checking its Revenue growth, Gross, Operating and Net Margins compared to its last 5-year median.
How efficiently has it utilized Capital?
By checking its ROCE, ROA, ROE and its Cash Conversion Cycle.
How is it managing its Debt?
By checking its Debt to Equity and Cash Flow from Operations.

A: What are the trends in revenue and profit margins?

Q.1 Revenue growth of Hindustan Construction Company Ltd?

Hindustan Construction Company Ltd revenue growth is -4.8% for FY-2025, which is below its 5-year CAGR of 5.65%, indicating slower growth.

Q.2 Gross Profit margin of Hindustan Construction Company Ltd?

Hindustan Construction Company Ltd Gross profit margin which is the profit after deduction of direct costs, is 10.9% for FY-2025, which is above its 5-year median of 2.1%, indicating increasing margins.

Q.3 Operating Profit Margin of Hindustan Construction Company Ltd?

Hindustan Construction Company Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 19.43% for FY-2025, which is above its 5-year median of 13.64% indicating increasing margins.

Q.4 Net Profit Margin of Hindustan Construction Company Ltd?

Hindustan Construction Company Ltd Net Profit Margin is 1.77% for FY-2025, is in line with its 5-year median of 1.77%, indicating stable margins.

	Current Level	5-year Historic Median
Gross Profit Margin (%)	10.9	2.1
Operating Profit Margin (%)	19.43	13.64
Net Profit Margin (%)	1.77	1.77

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Hindustan Construction Company Ltd?

Hindustan Construction Company Ltd Return on Asset is 1.03%, which is in line with its 5-year historical median of 1.03%, indicating stable asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Hindustan Construction Company Ltd?

Hindustan Construction Company Ltd Return on capital employed is 31.79% for FY-2025, which is in line with its 5-year historical median of 31.79%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 14%, indicating value creation.

Q.7 Return on Equity (ROE) of Hindustan Construction Company Ltd?

Hindustan Construction Company Ltd Return on equity is 5.99% for FY-2025, which is in line with its 5-year historical median of 5.99%, indicating the business is making similar use of its shareholders capital.

Q.8 Cash conversion cycle of Hindustan Construction Company Ltd?

Hindustan Construction Company Ltd Cash conversion cycle is -24 days, below its 5-year historical median of -8 days, indicating improved working capital management. However, you need to compare this with its peers in the industry.

	Current Level	5-year Historic Median
Asset Turnover (x)	0.58	0.56
ROE (%)	5.99	5.99
ROCE (%)	31.79	31.79
Cash Conversion Cycle	-24 days	-8 days

C: How much debt does the business have and is it at a sustainable level?

Q.9 Debt to Equity ratio of Hindustan Construction Company Ltd?

Hindustan Construction Company Ltd Debt-to-Equity ratio is 0.79, which is above the industry average of 0.38, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Hindustan Construction Company Ltd?

Hindustan Construction Company Ltd Debt to cash flow from operations is 20.21, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Hindustan Construction Company Ltd?

Q.1 Promoter shareholding and pledge status of Hindustan Construction Company Ltd?

Promoters hold 16.72% of the Hindustan Construction Company Ltd, with 79.74% of their stake pledged, indicating high pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Hindustan Construction Company Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Hindustan Construction Company Ltd vs industry peers?

Hindustan Construction Company Ltd revenue CAGR is 5.65%, compared to the industry median CAGR of 0%, indicating faster growth and gaining its market share.

Profit Metrics

	Current Level	5-year Industry Median
Revenue Growth (%)	-4.8	-
Gross Profit Growth (%)	95.2	17
Operating Profit Growth (%)	35.8	14
Net Profit Growth (%)	-52.5	20.3

Operating Efficiency

	Current Level	5-year Industry Median
Asset Turnover (x)	0.58	0.63
ROE (%)	5.99	6.16
ROCE (%)	31.79	10.5
Cash Conversion Cycle (days)	-23.74	52

Valuation & price assessment

Q.1 Stock return of Hindustan Construction Company Ltd over the last decade?

Over the last 9 year(s), the stock has delivered a CAGR of 4.3% based on the current price.

	9Y	5Y	3Y	1Y
Share Price CAGR	4.3%	21.6%	13.4%	-16.5%

Q.2 Valuation ratios of Hindustan Construction Company Ltd vs historical?

The current P/E ratio of 26.1 is higher than its historical median of 11.79, indicating that the stock is trading above its historical average valuation.

Q.3 How do the current valuation ratios compare with 5-year historical median and industry numbers?

Valuation Ratios	Current	5-year Historic Median	5-year Industry Median
Price to Earnings	26.1	11.79	21.52
Price to Book	1.74	4.21	1.74
Price to Sales	1.36	0.79	1.51
EV to EBITDA	7.98	7.15	11.49

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Check Before You Invest : Hindustan Construction Company Ltd

Snapshot

Performance Analysis

Ownership & governance

Peer comparison (industry-wise, mcap)

Profit Metrics

Operating Efficiency

Valuation & price assessment

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