Buy IRB Infrastructure Developers; target of Rs 152: Prabhudas Lilladher

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26 Aug, 2025 12:21

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For 1QFY21 IRB reported good set of numbers with revenues at Rs10.2bn, beating our and street estimates along with stable EBITDA margin of 46.7%. Post relaxation in lockdown, company saw sharp revival in toll collection across projects which stood at an average ~80% YoY pre-covid levels in July’20, with some projects already reaching at pre-covid levels. On the back of extension of concession period by NHAI and RBI’s relief of loan moratorium, management expects NPV of cash flow from its BOT portfolio to remain largely unaffected because of Covid-19 pandemic. IRB Infrastructure is one of the largest BOT toll operators in the country having market share of ~22% in the total Golden Quadrilateral projects with over 3,700km of total projects successfully executed. At CMP, the stock trades at a P/E of 9.5x/5.8x on FY21E/FY22E EPS and is trading at an EV of 4.5x/4.2x FY21E/FY22E EBITDA. We have marginally tweaked our FY21E/ FY22E earnings estimates by 0.3%/0.6%.

We maintain BUY rating on the stock with revised SoTP based TP of Rs152 (earlier TP Rs139). Revised TP is mainly due to 50% value assignment to IRB InvIT investment (lock-in period is over).

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