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HDFC Securities Gives a Buy Call on IRB Infrastructure Developers with a Target of Rs. 142

HDFC Securities is bullish on BSE and NSE listed IRB Infrastructure Developers Ltd. (IRB), India’s leading and largest highway infrastructure developers, with an asset base of over Rs. 45,000 Crs., has recommended Buy rating on the stock with a target price of Rs. 142 in its recently released research report.

Meanwhile, the company has posted Excellent results with a Consolidated Income of Rs. 1,635 Cr. for Q4 and Rs. 7,047 Cr. for the entire FY20. The numbers include 1 month of Tolling & O & M of the newly bagged Mumbai Pune Expressway concession and exclude 1 month of contribution from 9 assets transferred to IRB Private INVIT.

For FY20, Company’s EBITDA was up by 1% at Rs. 3,166 Cr. The company registered a Q4 profit of Rs. 154 Cr. Mr. Virendra D. Mhaiskar, Chairman & Managing Director, IRB Infrastructure Developers Ltd. said, “Except last 15-20 days of March 2020, rest of FY20 brought good developments for us; especially the investment deal with GIC Affiliates, Singapore; getting re-awarded prestigious Mumbai-Pune Expressway project under TOT model and commissioning of Goa-Kundapura NH-17 BOT project to make all our projects revenue-generating.” He further added, “Though the ongoing scenario has a dominance of COVID-19 pandemic, we sense gradual normalization of operations, with traffic gaining pace every single day as lockdown is gradually laxed across the country.”

Recently, Singapore’s sovereign wealth fund GIC had invested Rs. 4,400 crores in a road platform set up by IRB. According to experts, Mumbai-Pune Expressway is expected to perform exceedingly well given that it is the primary route that connects the two large metros, whereby IRB would be benefitted.

IRB emerged as the winner for India’s largest single road TOT – Mumbai Pune Expressway, for the second time running, at a bid price of Rs. 8,262 Crs. Achieved financial closure and commenced tolling post receiving appointed date from the NHAI for the Hapur-Moradabad NH-9 BOT project. All BOT projects under IRB umbrella are revenue-generating now.

The Company has a strong track record of constructing over 12,600 lanes Kms pan India in 2 decades and has an ability to construct over 500 Kms in a year. IRB Group’s portfolio comprises 21 projects including 19 BOT, 1 TOT, and 1 HAM projects. BOT segment includes 9 projects under Private InvIT with O & M contracts; 3 projects under Tolling & 7 projects under O & M contracts as a Project Manager for IRB InvIT.

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