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NCC Slumps On Report Of New Andhra Pradesh Government Cancelling Projects

The company says it is yet to get any communication regarding cancellation of the projects.

A Broker looks a graph depicting the change in sterling on the trading floor. (Photographer: Jason Alden/Bloomberg)
A Broker looks a graph depicting the change in sterling on the trading floor. (Photographer: Jason Alden/Bloomberg)

NCC Ltd.’s shares fell as much as 15 percent after a PTI report said the new Andhra Pradesh government led by YS Jaganmohan Reddy cancelled some of the projects sanctioned by former chief minister Chandrababu Naidu.

The state contributes around 30 percent to the order book of the infrastructure developer. “Out of the total order book of Rs 40,000 crore, nearly Rs 14,000 crore comes in from Andhra Pradesh,” Motilal Oswal said in a note, adding that the new government has announced cancellation for orders before April 1, 2019 where no work has started.

The company, however, denied knowledge of any such action by the newly formed state government. “We are yet to get any communication regarding cancellation of the projects,” NCC’s Executive Vice President YD Murthy told BloombergQuint. “We will comment once we get clarity on the new government’s directives in this regard.”

The orders received by the company from the state include irrigation, housing and infra projects.

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