Afcons Infrastructure , a part of the Shapoorji Pallonji group, saw its shares climb 3.7% to Rs 434.45 following the announcement of a significant railway project win in Croatia. The company has emerged as the lowest bidder for a contract awarded by HŽ Infrastruktura d.o.o., solidifying its position in the international infrastructure sector.

Project Details

The project, valued at €677 million (approximately Rs 6,800 crore) excluding VAT, involves the reconstruction of existing track and the construction of a second line on the Dugo Selo–Novska railway route. The scope of work includes:

• Reconstruction of the existing track
• Construction of a second track
• Overhead electrification
• Signalling and telecommunication works

According to the company's disclosure to the stock exchanges, the project has a completion timeline of 72 months from the commencement date.

Financial Implications

This contract win represents a significant addition to Afcons Infrastructure's order book. At the current exchange rate of 1 Euro = INR 100.44, the project value translates to approximately Rs 6,800 crore, providing a substantial boost to the company's future revenue prospects.

Stock Performance

Despite the recent 3.7% gain following the news, Afcons Infrastructure's stock has faced challenges in the broader market:

• 17% decline over the past six months
• 22% decrease year-to-date

However, analysts maintain a positive outlook on the stock:

Company Updates

In addition to the railway contract win, Afcons Infrastructure has recently made other significant announcements:

1. The company has requested the withdrawal of credit ratings for its bank facilities from ICRA Limited, based on no-objection certificates received from most of its bankers.
2. ICRA has already withdrawn ratings for bank facilities except for those from Bank of Baroda, for which the withdrawal process is ongoing.

These developments, along with the major contract win in Croatia, indicate that Afcons Infrastructure is actively managing its financial profile while expanding its international project portfolio.

As the company moves forward with this substantial railway project in Croatia, investors and market watchers will likely keep a close eye on Afcons Infrastructure's execution capabilities and the potential impact on its financial performance in the coming years.

Afcons Infrastructure Limited , a prominent player in the infrastructure sector, has made significant strides in the international market by emerging as the lowest bidder for a major railway project in Croatia. The project, valued at approximately ₹6,800.00 crore (€677.07 million), marks a substantial opportunity for the company in the European infrastructure landscape.

Project Details

According to a recent disclosure by Afcons Infrastructure to the stock exchanges, the company has been declared the Lowest Bidder (L1) by HŽ INFRASTRUKTURA d.o.o. (HŽ Infrastructure Ltd) for a comprehensive railway line project in the Republic of Croatia. The scope of work includes:

• Reconstruction of the existing track
• Construction of a second track on the Dugo Selo - Novska railway line
• Installation of overhead electrification
• Implementation of signalling and telecommunication works

Financial Aspects

The estimated value of the contract, excluding taxes (VAT), stands at €677,071,899.78, which is equivalent to approximately ₹6,800.00 crore. This valuation is based on an exchange rate of 1 Euro = INR 100.44, as reported by the company.

Project Timeline

The project is slated for completion within 72 months from the commencement date, post-award of the contract. This extended timeline underscores the scale and complexity of the infrastructure development undertaking.

Significance of the Project

This railway project represents a significant international expansion for Afcons Infrastructure. Securing the lowest bid for such a substantial European infrastructure project not only demonstrates the company's competitive edge in the global market but also opens doors for potential future opportunities in the region.

Corporate Disclosure

The information about this project was disclosed by Afcons Infrastructure Limited in compliance with Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The disclosure was made to both the BSE Limited and the National Stock Exchange of India Ltd, where the company's shares are listed.

This development comes as a positive indicator for Afcons Infrastructure's growth strategy and its capability to compete on an international scale. As the project moves forward, it will be interesting to observe how this venture impacts the company's financial performance and market position in the coming years.