Buy IVRCL; target of Rs 35: Angel Broking

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26 Aug, 2025 12:21

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Angel Broking is bullish on IVRCL and has recommended buy rating on the stock with a target of Rs 35 in its February 15, 2013 research report.
 
“For 2QFY2013, IVRCL reported a disappointing set of numbers on the operating front, which were significantly below our and consensus estimates. The company’s order book stands at ~Rs25,000cr (4.9x trailing revenues). IVRCL is in an advanced stage of negotiation for sale of three road BOT projects. As per the Management, these asset sales are intended towards meeting the equity requirement for the road BOT projects and reducing debt levels.”
 
“The company reported a revenue of Rs1,270cr in 2QFY2013, registering a growth of 5.6 percent yoy which was ahead of our estimate by 19.9 percent. At the operating level, the company posted an abysmal EBITDA margin of 5.4 percent, a decline of 250bp/172bp on yoy/qoq basis and was significantly below our estimates of 8.5 percent. This was mainly on back of various one-time provisions such as (a) service tax write off, (b) claims on receivables from clients and (c) cost overruns in 4-5 projects aggregating to ~Rs72cr provided during the quarter. On the earnings front, IVRCL reported a loss of Rs68cr (our estimate was a loss of Rs13cr) against a profit of Rs7cr in 3QFY2012.”
 
“IVRCL has a strong order book of ~Rs25,000cr (4.93x trailing revenue), which provides comfortable revenue visibility. However the proportion of slow moving orders remains high in the current order book. Given the slower-than-expected execution and weak performance in 1HFY2013, we lower the EPS estimates for FY2013 and FY20104 to Rs(3.9) and Rs2.9 respectively. The stock is trading at FY2014E P/E (excluding subsidiaries) and P/BV of 3.1x and 0.4x respectively. We recommend Buy rating on the stock with a target price of Rs35,” says Angel Broking research report.

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