Vascon JV sells Pune land parcel

Vascon Engineering, the infrastructure developer, sold land parcel held under a joint venture to Pune PB Development for a total consideration of Rs 170 crore.

Ajanta Enterprises, a partnership firm in which Vascon holds 50% partnership, concluded the sale on December 17, has received the sales proceeds net of tax.

Meanwhile, retail investors witnessed a dreadful journey in Vascon over the last three years.

The returns over the last three years have been disappointing. Indeed, the share price is down a tragic 59% in the last three years.

Some solace is achieved in the last three months with share price recovering 19%.

Some might say the recent bounce is to be expected after such a bad drop.

The rise has some hopeful, but turnarounds are often precarious.

During the unfortunate three years of share price decline, Vascon Engineers actually saw its earnings per share (EPS) improve by 107% per year.

The company has kept revenue pretty healthy over the last three years, so we doubt that explains the falling share price.

Vascon Engineers shareholders are down 34% for the year, but the market itself is up 7.3%.

Recently, Vascon has bagged orders from Airport Authority of India and Bangalore Metro Rail Corporations which may signal a turnaround in the company’s fortune very soon.

What is interesting is that the company is present market cap is Rs 259 crs while the sale proceeds is are Rs 170 crs. While vascons share is 50% it is still quite attractive at Rs 85 crs which may be used to repay the debt which stood at Rs 210 crs as on March 2019.

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