This multibagger EPC Stock turned 3 Lakh into 50 Lakh giving 1700% Return in one Year: Owing to huge order book

At the heart of Bondada Engineering’s success is its massive order book. The company operates in the EPC sector, catering to infrastructure development, renewable energy, and telecommunications. Over the past year, Bondada has secured several high-value contracts, including projects in:

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• Renewable Energy Infrastructure: Leveraging the global shift towards clean energy, Bondada has bagged contracts for the construction of solar and wind power facilities.
• Telecommunication Tower Installation: With the rise of 5G and rural connectivity initiatives, the company has been a preferred partner for building telecom infrastructure.
• Industrial Projects: From manufacturing facilities to logistics hubs, Bondada’s expertise in executing large-scale projects has been in high demand.

These projects not only ensured a steady revenue stream but also positioned the company as a trusted player in the EPC space.

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Financial Performance: Stellar Growth

Bondada Engineering's financials have shown remarkable growth despite the challenges posed by inflation and supply chain disruptions. Key highlights include:

• Revenue Surge: The company's revenue has increased significantly, reflecting the timely execution of its robust order book.
• Profit Margins: Effective cost management and operational efficiency have enabled Bondada to maintain strong margins.
• Debt Control: While scaling up operations, the company kept its debt under check, ensuring financial stability.

The combination of these factors has resulted in investor confidence, leading to a sharp rise in its stock price.

Investors who believed in Bondada Engineering a year ago have reaped phenomenal rewards. The stock price's rapid appreciation is not just a reflection of market speculation but a response to the company's solid fundamentals and future growth prospects. An initial investment of ₹3 lakh has grown to ₹50 lakh, making Bondada a standout performer in the EPC sector.

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Key Growth Triggers:

1. Company has a closing Order book at 5342 Cr, to be executed in 18-24 months and expects to double its revenue and profit in FY25. Apart from telecom and renewable energy, the company is planning to enter Railways.

2. Management have given a guidance of INR 4,000 Cr in revenue by FY27, which is 5x growth over 3 years and expects a PAT of INR 330-340 Cr and aims to achieve an order book of at least INR 6,000 Cr by Mar 31, 2025.

3. Company has 2 GW projects in hand, Ambitious target of 10+ GW by 2030 and 600+MW commissioned till date and aims to become one of the “Top Five EPC Companies in India” by 2030.

4. Board meeting is scheduled to be held on Oct 22, 2024 to consider fund raise of an aggregate amount of INR 500 Cr.

5. Company fixed Assets increased from INR 41 Cr in Mar 2024 to 51 Cr in Sep 2024, a 24% Increase and Clients are Bharti Airtel, BSNL, Reliance Jio.

Recent Performance and Developments

1st November 2024:
Bondada delivered excellent results for the half year ending September 2024. Sales surged 63% year-on-year, climbing from ₹296 crore in September 2023 to ₹481 crore in September 2024. Net profit more than doubled, rising 2.4x from ₹15 crore to ₹36 crore. On a half-on-half basis, sales dipped slightly by 5%, but net profit still grew by 16%, showcasing operational efficiency.

17th October 2024:
The company’s board has scheduled a meeting on October 22, 2024, to discuss a fundraise of ₹500 crore, which is expected to support its ambitious growth plans.

14th October 2024:
Bondada received a significant ₹390 crore Letter of Award from Maharashtra State Power Generation Company Limited (MAHAGENCO). This project involves the design, engineering, and commissioning of a grid-interactive solar PV power plant with dry cleaning technology, along with a 5-year operations and maintenance contract.

11th October 2024:
The company secured another major win from MAHAGENCO, worth ₹1,132 crore under the MSKVY 2.0 scheme. The award covers two EPC contracts: ₹763 crore for a ground-mounted solar PV power plant and ₹369 crore for solarization of agricultural feeders. Both projects include a 3-year O&M period and are expected to be completed within 9-12 mon

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Future Prospects: More Growth Ahead?

Bondada Engineering is not resting on its laurels. While the company has made a name for itself in telecom and renewable energy, it is now planning to enter the railway sector. In renewable energy, Bondada is also diversifying into Battery Energy Storage Systems (BESS) and Green Hydrogen, alongside its established solar and wind projects. 

The company currently has 2 GW of renewable energy projects under its belt and has set an ambitious goal of achieving over 10 GW by 2030. To date, Bondada has commissioned more than 600 MW of capacity. Bondada is actively participating in tenders worth ₹5,975 crore, with an additional ₹2,437 crore in tender submissions underway. These could potentially translate into significant new business wins.

The company is actively pursuing new contracts, especially in emerging sectors like green hydrogen infrastructure and smart cities. With a strong focus on innovation and sustainability, Bondada aims to solidify its market position further. 

However, investors should remain mindful of potential risks, including the cyclical nature of the EPC industry and the possibility of execution delays. That said, with its proven track record and strategic growth plans, Bondada is well-poised for continued success. Bondada aims to rank among the top five EPC companies in India by 2030, a bold yet achievable target given its current trajectory.

Conclusion: A Transformational Journey

Bondada Engineering’s transformation from a mid-tier EPC firm to a stock market darling is a testament to its operational excellence and strategic foresight. Its ability to deliver unparalleled returns while securing a strong foothold in high-growth sectors makes it a compelling story for both current and prospective investors.

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