Accumulate Engineers India; target of Rs 250: Prabhudas Lilladher

Prabhudas Lilladher recommended Accumulate rating on Engineers India with a target price of Rs 250 in its research report dated June 04, 2025.

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June 04, 2025 / 10:45 IST

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26 Aug, 2025 12:21

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Prabhudas Lilladher's research report on Engineers India

We cut our FY26/27E EPS estimates by -7.0%/-5.5%, factoring in lower dividends from equity investments leading to lower other income and downgrade our rating from ‘Buy’ to ‘Accumulate’ due to sharp run up in the stock price. Engineers India (EIL) reported a strong quarter with 25.5% YoY growth in revenue and EBITDA margin expanding by 1,200bps YoY to 21.6%. EIL is well positioned to capitalize on the growing domestic momentum in the hydrocarbon sector while its strategic diversification into non-O&G verticals, which now accounts for ~30% of the order book, broadens its revenue streams. EIL is also witnessing strong traction from the Middle East, which is expected to be a key growth driver for its consultancy segment. Furthermore, the company is tapping into emerging opportunities in sunrise sectors such as defence, leveraging its proven technical credentials. Backed by this robust positioning, management has guided for a healthy 15–20% revenue growth in FY26 and aims to sustain an annual order intake run rate of ~Rs50bn.

Outlook

We roll forward to Mar’27E and value the Consultancy/Turnkey segments at a PE of 22x/10x Mar’27E (22x/10x Sep’26E earlier) arriving at a revised SoTP-derived TP of Rs250 (Rs242 earlier). Downgrade to ‘Accumulate’.

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