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MomentumDeep Value

Which Infra - Construction & Contracting Stocks Are Deep Value Picks in Week of Jun 27, 2026?

ACCELHIDDEN GEM

In the Week of Jun 27, 2026, the Infra - Construction & Contracting sector has 2 stocks that are underperforming Nifty 500 but have accelerating quarterly earnings. Average value score is 46/100 with PAT acceleration of +146pp.

Total Stocks
2
deep value
Avg Fundamental
46
/100
Top Pick
Hazoor
Score: 84/100
Avg Margin of Safety
Fairly Valued

Stock Distribution

0 Strong0 Good3 Average0 Weak

Earnings & Valuation Signals

🔄

2 turnarounds: SPML Infra Ltd, PNC Infratech Ltd

⚠️

1 stock flagged for margin pressure — profits may not sustain.

💰

2 of 3 stocks trading below fair value — sector offers value opportunities.

📊

Operating margins volatile across 3 stocks — earnings quality uneven, watch for stabilization.

AI Research Summary

Sector Pulse

The Infra - Construction & Contracting sector is navigating a period of record order inflows contrasted against significant one-time regulatory and legislative costs. Larsen & Toubro (LT) reached a historic order book of ₹7.33 trillion, while Hazoor Multi Projects (532467) maintained visibility with a ₹1,200 crore book. However, the quarter was marred by a ₹11.9 billion provision at LT for new Labour Codes and a 15.67% revenue decline at Hazoor following a subsidiary exit. Despite these hurdles, operational efficiency remains a core theme, with both constituents reporting margin expansion.

Catalysts Playing Out Across the Pack

Order book wins and value-unlocking divestments are the primary drivers. LT's 17% YoY growth in order inflows and Hazoor's ₹277.40 crore in new wins highlight a robust demand environment. Furthermore, both companies are cleaning up balance sheets; LT is divesting the Hyderabad Metro to remove ₹13,000 crore in debt, while Hazoor is converting debt to equity in its marine subsidiary to consolidate ownership.

What Managements Are Guiding

Management commentary is largely confident. LT has raised its order inflow growth guidance for FY26 to >10% after a 30% surge in the first nine months. They also lowered their Net Working Capital target to 10%, signaling better collection intensity. Hazoor, while not providing quantitative guidance, points to its ₹1,200 crore order book as a guarantor of revenue for the next 24 months.

Sub-Sector Aggregates

Aggregate metrics reveal a sector with high revenue visibility but varying working capital health. The EBITDA margin range spans from 10.4% at LT to 21.96% at Hazoor. Working capital remains a point of divergence; LT improved its NWC/Revenue ratio to 8.2%, whereas Hazoor is struggling with debtor days reaching 117. Capex intensity remains steady, with a combined commitment of approximately ₹1,480 crore toward project equity and technology.

Shared Risks (9-type taxonomy)

Regulatory and litigation risks are prevalent. Both constituents face headwinds from fund allocations in domestic segments or ratings downgrades. Labor risk emerged as a high-severity factor for LT due to the ₹11.9 billion provision. Litigation also persists, with Hazoor carrying ₹366 crore in contingent liabilities and LT managing cost overruns in legacy hydrocarbon projects.

Bottom Line

The sector is fundamentally strong on the order-inflow front, but bottom-line volatility from one-time provisions and working capital stress in smaller players warrants a balanced view. LT's recurring PAT growth of 31% suggests the underlying business remains healthy despite the reported PAT dip.

Last updated Apr 19, 2026

3 stocks in this sector

View:
Average48/100

SPML Infra Ltd

1.7K Cr
Undervalued
Earnings Pulse
PAT YoY
+125%
Turnaround
Revenue YoY
+54%
Momentum
Building
↗
Average47/100

Hazoor Multi Projects Ltd

642 CrAccel
Very Overvalued
Earnings Pulse
PAT YoY
+88%
Stable
Revenue YoY
-36%
Momentum
Slowing
↘
Average44/100

PNC Infratech Ltd

—
Undervalued
Earnings Pulse
PAT YoY
+44%
Turnaround
Revenue YoY
-5%
Momentum
Accelerating
▲
Margin Pressure

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Frequently Asked Questions: Infra - Construction & Contracting

Based on publicly available financial data. This is educational research, not investment advice.

How many Infra - Construction & Contracting stocks are deep value opportunities worth studying?

There are currently 2 stocks in the Infra - Construction & Contracting sector that qualify as deep value opportunities worth studying. These stocks are underperforming the market despite showing improving earnings — a classic contrarian research signal.

Which Infra - Construction & Contracting deep value stocks appear most undervalued?

The most undervalued Infra - Construction & Contracting deep value stocks based on fair value analysis

  • SPML Infra Ltd — Undervalued
  • PNC Infratech Ltd — Undervalued
  • Hazoor Multi Projects Ltd — Significantly Overvalued
  • Stocks sorted by valuation signal (most undervalued first).

Which Infra - Construction & Contracting deep value stock has the highest earnings acceleration?

Infra - Construction & Contracting deep value stocks with the highest earnings growth

  • SPML Infra Ltd — PAT growth +125.0% YoY, earnings turning around (inflection up)
  • Hazoor Multi Projects Ltd — PAT growth +88.2% YoY, earnings stable
  • PNC Infratech Ltd — PAT growth +44.0% YoY, earnings turning around (inflection up)

Why are Infra - Construction & Contracting stocks underperforming despite improving earnings?

Infra - Construction & Contracting deep value stocks are underperforming despite improving earnings because the market has not yet recognized their earnings recovery. This creates a potential opportunity for patient investors

  • The market often takes 2-4 quarters to re-rate stocks after earnings improve
  • Deep value stocks typically have a negative narrative that suppresses sentiment
  • Improving earnings combined with market underperformance creates a valuation gap
  • When the market eventually recognizes the recovery, re-rating can be significant
  • This is an educational explanation of deep value investing theory.

Which Infra - Construction & Contracting deep value stocks have the highest revenue growth?

Infra - Construction & Contracting deep value stocks with the highest revenue growth

  • SPML Infra Ltd — Revenue growth +54.0% YoY
  • PNC Infratech Ltd — Revenue growth -5.1% YoY
  • Hazoor Multi Projects Ltd — Revenue growth -36.5% YoY

What is the average PE ratio of Infra - Construction & Contracting deep value stocks?

The average PE ratio of Infra - Construction & Contracting deep value stocks is 16x. Deep value stocks typically trade at lower PE multiples relative to their sector peers, reflecting the market's skepticism about their recovery.

Is the earnings recovery in Infra - Construction & Contracting sustainable?

Sustainability indicators for the Infra - Construction & Contracting deep value earnings recovery

  • 2 stocks showing turnaround (inflection up)
  • A sustainable recovery shows more stocks accelerating than decelerating.

Is Infra - Construction & Contracting a contrarian opportunity worth studying?

Infra - Construction & Contracting as a contrarian opportunity — key research signals

  • 2 stocks underperforming the market (contrarian setup)
  • 2 stocks appear undervalued based on fair value analysis
  • 2 stocks showing turnaround signals
  • Contrarian investing requires patience.

What is the typical recovery timeline for deep value stocks?

Deep value stock recovery timelines vary, but historical patterns suggest

  • 1-2 quarters: Earnings inflection detected, market still skeptical
  • 2-4 quarters: Consistent earnings improvement builds confidence
  • 4-6 quarters: Market re-rates, stock price catches up to fundamentals
  • Some stocks never recover — continuous monitoring is essential
  • Timelines are approximate and based on historical patterns.

What is deep value investing?

Deep value investing is a strategy of studying stocks that are underperforming the market despite showing improving fundamentals (earnings growth, margin expansion). The thesis is that the market has not yet recognized the earnings recovery, creating a potential valuation gap.

  • These stocks typically underperform indices like Nifty 500
  • They show positive earnings trends (PAT growth, revenue growth)
  • The market eventually re-rates them as earnings improvements sustain
  • It requires patience — recovery can take several quarters

The above FAQs are based on publicly available financial data. This is educational research only. Sector Alpha is not SEBI registered and does not provide investment advice.