Buy Power Mech Projects; target of Rs 2800 : ICICI Securities

ICICI Securities's research report on Power Mech Projects

Power Mech (POWM) delivered a good first half, with its adj. revenue/EBITDA up 10%/13% YoY. Historically, it has been delivering a much better H2 – in a full year, POWM has been doing ~2.5x its H1 revenue (in last three years). We expect the trend to continue this fiscal too; we bake in 15% revenue growth in FY26. Growth outlook for FY27–28E remains upbeat, with its mining production potentially ramping up; note that the mining business commands higher margins than its blended EBITDA margins. The company reported order inflow (OI) of >INR 48bn in YTD FY26 and it expects OI to touch INR 100bn in full-FY26. Its order book (OB) is healthy at INR 142bn, as of Sep’25 (ex-MDO orders of INR 396bn), with a book-to-bill ratio of 2.6x (OB at YTD FY26 at INR 167bn). The order outlook remains strong in the near–medium term given robust pipeline in thermal power. POWM is also keen on opportunities in the steel sector and iron ore (MDO). We upgrade to BUY, from Hold.

Outlook

Given the correction in the stock’s price over the last three months, we upgrade POWM to BUY, from Hold, with a revised TP of INR 2,800 (INR 2,986 earlier).