Hold Supreme Infrastructure; target of Rs 221: ICICIdirect

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26 Aug, 2025 12:21

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ICICIdirect.com report on Supreme Infrastructure India

"Supreme Infrastructure India recently announced that it is planning to raise funds aggregating Rs 99 crore through issuance of 33.5 equity shares at Rs 185/share and 20 lakh warrants at Rs 185/share on a preferential basis to promoters and non promoters. Our interaction with the management indicates these funds would be predominantly used for debt reduction. Additionally, the company is exploring other options such as securitisation of BOT projects as and when it is possible. We believe the company’s focus on pruning debt is a move in the right direction over the long term. We assign a HOLD rating to the stock due to the sharp dilution from fund raising plans impacting our FY15E EPS by ~20 percent and higher leverage even after fund raising."

"While we continue to like Supreme given its robust revenue growth (~14.7 percent CAGR in FY13-15E) in the EPC business, superior margins and return ratios in a challenging scenario along with largely funded BOT projects, we assign a HOLD rating with a target price of Rs 221/share, largely on account of higher dilution from fund raising plans and higher leverage even after fund raising," says ICICIdirect.com research report.

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