Hold IRB Infrastructure; target of Rs 140: ICICI Direct

ICICI Direct recommended hold rating on IRB Infrastructure with a target price of Rs 140 in its research report dated May 31, 2019.

Broker Research

June 17, 2019 / 16:35 IST

26 Aug, 2025 12:21

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ICICI Direct's research report on IRB Infrastructure

IRB Infrastructure’s (IRB) topline grew 41.0% YoY to Rs 1948.3 crore (our estimate: Rs 1761.8 crore) due to strong growth in construction revenues (59.0% YOY to Rs1407.9 crore). EBITDA margin declined sharply by 865 bps YoY to 39.0% (our estimate: 43.3%) mainly due to lower margin in the construction division. PAT declined 13.2% YoY to Rs 208.0 crore (our estimate: Rs 244.6 crore) on account of sharp EBITDA margin contraction, higher finance cost and higher tax rate.

Outlook

IRB’s construction revenues are expected to grow robustly on the back of strong OB position. However, appointed date for Tamil Nadu Ham projects remain key for construction revenue growth in FY20E. Moreover, toll revenues from some of its key projects like Agra-Etawah and other three Rajasthan projects continue to remain weak due to construction activities and traffic diversion. Hence, we maintain our HOLD rating on the stock with a revised SOTP based target price of Rs 140/share.

For all recommendations report, click here