The shares of infrastructure player AB Infrabuild witnessed a significant surge during Wednesday's intraday trading session, climbing 4.5% to reach a two-week peak of ₹19.8. This upward movement was a direct reaction to the company's announcement of securing multiple substantial orders, reinforcing its growth trajectory in the infrastructure sector.
Details of the Major Order Wins
In a regulatory filing made after market hours on Tuesday, January 7, the company disclosed a major contract win. AB Infrabuild has secured an order worth ₹51.43 crore from the East Coast Railways, a division of Indian Railways. The project involves the construction of a road over bridge (ROB).
Notably, this marks the second significant order from East Coast Railways in a very short span. In late December, the company had won a similar contract valued at approximately ₹52 crore for the construction of another road over bridge. This back-to-back order win highlights the company's strong relationship and execution credibility with the railways.
In a separate development, the company announced another order win on Monday. AB Infrabuild has been awarded a contract worth ₹10.75 crore by the MP Road Development Corporation. The project entails the construction of additional lanes to function as truck parking or lay-by areas on the Sohagi Ghat stretch of the Mangawan to MP-UP border section on National Highway-30 in Madhya Pradesh. This project will be executed under the Engineering, Procurement, and Construction (EPC) mode.
The cumulative value of these two fresh orders stands at ₹62.18 crore, providing a solid revenue pipeline for the company.
A Stellar Wealth Creation Journey
AB Infrabuild has established itself as a remarkable wealth creator in the Indian equity markets since its listing in 2019. While the stock has experienced periodic corrections, it has consistently demonstrated resilience with swift recoveries, rewarding its long-term investors handsomely.
The stock's performance in the recent past has been particularly impressive. Over the last eight months alone, the share price has skyrocketed by 116%, reaching the current trading level around ₹19.80. During this bullish phase, the stock achieved a new all-time high of ₹22.50 per share in September 2024.
The company has an enviable track record of annual returns. It has closed each of the last five calendar years in positive territory. The year 2023 was the most spectacular, with the stock surging a staggering 339%. This was followed by a robust gain of 102% in 2024. Cumulatively, the stock has delivered an eye-popping return of 3600% over this period, truly justifying its 'multibagger' status.
Strong Retail Investor Confidence
The faith of retail investors in AB Infrabuild's story is evident from the shareholding pattern. According to the latest BSE data available for the quarter ending September 2024, retail shareholders collectively hold a significant 69.1% stake in the company. This substantial holding indicates widespread belief in the company's fundamentals and future prospects among individual investors who have been richly rewarded for their conviction.
The latest order wins from prestigious government entities like Indian Railways and state road development corporations are likely to further strengthen investor confidence. They not only assure near-term revenue visibility but also validate the company's technical expertise and competitive positioning in the infrastructure contracting space. Market participants will now watch closely for the execution timelines and margin profiles of these new projects.
Disclaimer: Investors are advised to consult with certified financial experts before making any investment decisions.
