Any current/future new fundraising through debt or equity?

Currently, Ircon International Limited is not planning any equity buyback despite the depressed equity market valuation, as stated by Ragini Advani. The company intends to reinvest its profits primarily into highway, coal JV connectivity projects, and renewables to support growth and diversification. There is ongoing equity infusion planned into SPVs and JVs, with about ₹500-600 crores expected in FY24, mainly for highway projects and partially for renewable and coal projects. Some borrowing from the market is involved to fund equity contributions in these SPVs, but no specific new large-scale

Any current/future capex/capital investment/strategic investment?

Ircon plans a total equity/quasi-equity investment of about ₹900 crores over the coming years, mainly spread across highway projects, renewable energy, and coal JVs. For FY23, an additional ₹50 crores equity investment is expected; FY24 is forecasted to see a larger CAPEX of around ₹500-600 crores. Of this, roughly ₹400-450 crores will be invested in highway SPVs, with ₹50-100 crores allocated to JV projects. Standalone CAPEX (routine assets, plant & machinery for EPC projects) for the current year is around ₹242 crores. The company is borrowing funds from the market to support equity infusion

Future growth expectations in sales/revenue/volumes?

FY23 revenue expected between ₹9,000 to ₹9,500 crores, possibly crossing ₹10,000 crores depending on execution efforts. FY24 revenue projected to grow by 5% to 10% over FY23, targeting over ₹10,000 crores. On a conservative basis, 10% growth; bullish scenario up to 15% growth. Growth dependent on project execution speed and external factors beyond control. Focus on winning large, niche, high-value railway projects with less competition to sustain margins. Expansion in highway projects ongoing, with some SPVs starting to contribute profits in 1-2 years. Bidding activity expected to resume stron

Future growth expectations in earnings/operating earnings/profits/EPS?

FY23 revenue expected around ₹9,000–9,500 crore; confident to cross ₹10,000 crore. FY24 projected revenue growth: 5% to 10%, possibly up to 15% in a bullish scenario, aiming for slightly above ₹10,000 crore. EBITDA margin guidance: 10% to 11%; core EBITDA around 8.5%. PAT margin guidance: approximately 7.5% to 8%, expected to be sustainable into FY24. Margins to be maintained through selective bidding, focusing on niche, large-size railway projects (e.g., bullet train, J&K projects) to avoid low-margin small contracts. Operating income from SPVs/JVs expected to increase as projects s

Current/ Expected Orderbook/ Pending Orders?

Current consolidated order book stands at approximately ₹30,000 crores. The bullet train project order is about ₹6,200 crores, included within the total order book. The company is consciously selective in bidding, focusing on larger, technically demanding projects to maintain margins. Bid wins are largely from L1 (lowest bid) or QCBS (quality-cum-cost based) categories for larger projects. Plans to resume focused bidding from March/April 2023 to sustain or grow order book. Expecting to add quality projects aligned with strengths in railway infrastructure, highways, and niche areas. Some satell

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Ircon International LtdQ4 FY24Construction

Ircon International Ltd Q4 FY24 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹136P/E: 21.8Market Cap: ₹13.4K CrSector: Construction

Management growth scorecard

Revenue

Category 4

Margin

Category 3

Fundraise

Yes

Order

Yes

Capex

Yes

3 of 5 growth signals are positive.

Full analysis

Revenue guidance

Category 4

→FY23 revenue expected between ₹9,000 to ₹9,500 crores, possibly crossing ₹10,000 crores depending on execution efforts.
→FY24 revenue projected to grow by 5% to 10% over FY23, targeting over ₹10,000 crores.
→On a conservative basis, 10% growth; bullish scenario up to 15% growth.
→Growth dependent on project execution speed and external factors beyond control.
→Focus on winning large, niche, high-value railway projects with less competition to sustain margins.
→Expansion in highway projects ongoing, with some SPVs starting to contribute profits in 1-2 years.
→Bidding activity expected to resume strongly post-March/April for sustaining and increasing turnover.
→Bullet train project and high-speed rail expected to provide new opportunities, leveraging experience with Japanese technology.

Margin guidance

Category 3

→FY23 revenue expected around ₹9,000–9,500 crore; confident to cross ₹10,000 crore.
→FY24 projected revenue growth: 5% to 10%, possibly up to 15% in a bullish scenario, aiming for slightly above ₹10,000 crore.
→EBITDA margin guidance: 10% to 11%; core EBITDA around 8.5%.
→PAT margin guidance: approximately 7.5% to 8%, expected to be sustainable into FY24.
→Margins to be maintained through selective bidding, focusing on niche, large-size railway projects (e.g., bullet train, J&K projects) to avoid low-margin small contracts.
→Operating income from SPVs/JVs expected to increase as projects stabilize in 1-2 years, enhancing profitability.
→No significant buybacks planned; profits to be reinvested into highway, coal connectivity, and renewables projects for growth.
→Order book expected to sustain turnover with healthy margins; focus on profitable orders rather than volume-driven bidding.

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Fundraise plans

Yes

→Currently, Ircon International Limited is not planning any equity buyback despite the depressed equity market valuation, as stated by Ragini Advani.
→The company intends to reinvest its profits primarily into highway, coal JV connectivity projects, and renewables to support growth and diversification.
→There is ongoing equity infusion planned into SPVs and JVs, with about ₹500-600 crores expected in FY24, mainly for highway projects and partially for renewable and coal projects.
→Some borrowing from the market is involved to fund equity contributions in these SPVs, but no specific new large-scale debt or equity fundraising announcements were mentioned.
→The focus is on internal accruals and strategic investments rather than fresh equity issues or debt raising at this stage.

Order book

Yes

→Current consolidated order book stands at approximately ₹30,000 crores.
→The bullet train project order is about ₹6,200 crores, included within the total order book.
→The company is consciously selective in bidding, focusing on larger, technically demanding projects to maintain margins.
→Bid wins are largely from L1 (lowest bid) or QCBS (quality-cum-cost based) categories for larger projects.
→Plans to resume focused bidding from March/April 2023 to sustain or grow order book.
→Expecting to add quality projects aligned with strengths in railway infrastructure, highways, and niche areas.
→Some satellite projects, like highway SPVs and coal connectivity JVs, are at various construction stages.
→The company projects 5-10% top-line growth next fiscal with a steady inflow of high-value orders.
→No emphasis on merely increasing order book size at the expense of profitability.

Capex plans

Yes

→Ircon plans a total equity/quasi-equity investment of about ₹900 crores over the coming years, mainly spread across highway projects, renewable energy, and coal JVs.
→For FY23, an additional ₹50 crores equity investment is expected; FY24 is forecasted to see a larger CAPEX of around ₹500-600 crores.
→Of this, roughly ₹400-450 crores will be invested in highway SPVs, with ₹50-100 crores allocated to JV projects.
→Standalone CAPEX (routine assets, plant & machinery for EPC projects) for the current year is around ₹242 crores.
→The company is borrowing funds from the market to support equity infusion into large projects via SPVs.
→Investment focus aligns with ongoing highway projects and renewable/coal JV expansion.

How does Ircon International Ltd rank vs peers in Construction?

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