NCC vs NBCC Which Is a Better Investment?

The stocks of NCC and NBCC are two prominent players in the Indian construction and infrastructure development sector. NCC, a leading construction company, is known for its expertise in building highways, bridges, and residential complexes. On the other hand, NBCC is a government-owned construction company that specializes in project management and consultancy services. Both companies have a strong presence in the market, offering investors the opportunity to capitalize on the growth of India's infrastructure sector. In this comparison, we will delve into the key differences and similarities between NCC and NBCC stocks.

NCC or NBCC?

When comparing NCC and NBCC, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between NCC and NBCC.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. NCC has a dividend yield of 2.94%, while NBCC has a dividend yield of 0.44%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. NCC reports a 5-year dividend growth of 0.00% year and a payout ratio of -58.23%. On the other hand, NBCC reports a 5-year dividend growth of -13.42% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with NCC P/E ratio at -19.86 and NBCC's P/E ratio at 39.48. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. NCC P/B ratio is 2.10 while NBCC's P/B ratio is 7.06.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, NCC has seen a 5-year revenue growth of 0.16%, while NBCC's is 0.06%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with NCC's ROE at -9.97% and NBCC's ROE at 19.56%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are £155.20 for NCC and ₹93.91 for NBCC. Over the past year, NCC's prices ranged from £105.80 to £184.20, with a yearly change of 74.10%. NBCC's prices fluctuated between ₹42.53 and ₹139.83, with a yearly change of 228.76%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.