Ircon International Q1 Results Review - To Watch For Order Inflow: IDBI Capital

IDBI Capital Report

Ircon International Ltd. Q1 FY25 profit after tax came in-line with our estimate. Operating performance was weak as Q1 FY24 Revenue declined by 17% and and adjusted Ebitda margin at 6.8% was flat QoQ.

Ircon guides revenue growth to be flat on YoY basis in FY25 and Ebitda margin to be maintained at the same level. Its order win has been lukewarm and order book has seen weakness at Rs 260 billion in Q1 FY25 versus Rs 325bn YoY. This we understand could impact revenue of FY25E/26E, partially could be seen in H2 FY25.

Opportunity remains huge for Ircon and thus awaits order win. We value the company on SOTP with target price of Rs 272. Target price implies valuation of ~30 times FY26E earnings per share. Retain Hold rating on the company, stock catalyst are execution uptick and order win.

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