Why is NBCC falling/rising?

Recent Price Movement and Market Outperformance

NBCC’s stock price has been on an upward trajectory, having gained 6.81% over the past week compared to a marginal 0.13% rise in the Sensex benchmark. This outperformance is further highlighted by the stock’s 24.22% year-to-date return, significantly surpassing the Sensex’s 9.05% gain. Over the last three years, NBCC has delivered an extraordinary 322.48% return, dwarfing the benchmark’s 37.89%, and over five years, the stock has surged by 460.82%, compared to the Sensex’s 84.19% rise. Such sustained growth underscores the company’s ability to generate shareholder value consistently.

On the day in question, NBCC outperformed its sector by 5.18%, touching an intraday high of ₹116.20, representing a 6.12% increase. The stock has also recorded gains for three consecutive days, accumulating an 8.11% return during this period. Importantly, NBCC is trading above all key moving averages—5-day, 20-day, 50-day, 100-day, and 200-day—signalling strong technical momentum and investor optimism.

Strong Financial Fundamentals Supporting the Rally

NBCC’s rise is underpinned by its impressive fundamental metrics. The company boasts an average Return on Equity (ROE) of 21.71%, reflecting efficient utilisation of shareholder capital. Operating profit has expanded at a remarkable annual rate of 65.78%, signalling robust operational growth. Additionally, the company maintains a low average Debt to Equity ratio of zero, indicating a conservative capital structure and limited financial risk.

Recent financial results for the half-year ended September 2025 further reinforce the company’s strength. NBCC reported a Return on Capital Employed (ROCE) of 34.72%, one of the highest in its peer group, alongside an inventory turnover ratio of 13.30 times, demonstrating effective asset management. Quarterly Profit After Tax (PAT) stood at ₹153.52 crores, growing by 25.7%, which is a significant driver of investor confidence.

Valuation metrics also support the stock’s appeal. With an ROE of 25.1 and a Price to Book Value of 11.7, NBCC is trading at a premium relative to its peers, justified by its superior growth and profitability. The company’s Price/Earnings to Growth (PEG) ratio of 2.2 indicates that while the stock commands a premium, it is aligned with its earnings growth trajectory.

Consistent Outperformance and Shareholder Confidence

NBCC’s consistent returns over the last three years, outperforming the BSE500 index annually, have solidified its reputation as a reliable growth stock. The majority shareholding by promoters adds to the stability and governance confidence among investors. Despite a recent decline in delivery volume by 32.21% compared to the five-day average, liquidity remains adequate for sizeable trades, supporting smooth market operations.

Conclusion: Why NBCC’s Stock Is Rising

The recent rise in NBCC’s share price on 15-Dec is a reflection of its strong long-term fundamentals, impressive profitability metrics, and consistent market outperformance. The company’s ability to generate high returns on equity and capital employed, coupled with robust profit growth and prudent financial management, has attracted investor interest. Technical indicators, including trading above all major moving averages and consecutive days of gains, further bolster the bullish sentiment. While the stock trades at a premium valuation, this is supported by its superior growth prospects and consistent delivery of shareholder returns, making NBCC an attractive proposition in the current market environment.

Limited Time Only! Subscribe for Rs. 12,999 and get 1 Year of MojoOne + an Additional Year Completely FREE. Don't miss out on this exclusive offer. Claim Your Free Year →