This Navratna railway stock engaged in providing engineering and construction services, specializing in infrastructure projects such as railways, highways, and urban development, is in focus after the company order book is higher than its market cap and is currently trading at a discount of 53.31 percent.
Stock Price Movement:
With a market capitalization of Rs. 15,443.27 crores, the shares of Ircon International Limited were currently trading at Rs. 164.20 per equity share, rising nearly around 2.53 percent from its previous day’s close price of Rs. 160.15. The stock is currently trading at a discount of 53.31 percent from its 52-week high of Rs. 351.65.
Company Overview:
Ircon International Limited was established in 1976 and is a leading Indian engineering and construction company. It is engaged in the design, development, and implementation of infrastructure projects, primarily in the transportation sector, including railways, highways, and urban infrastructure, both in India and internationally.
Order Book:
The company’s current order book is worth approximately Rs. 21,939 crores. Of this, 53 percent comes from competitive bidding, and 47 percent is from nominations. Most of the orders, about 90 percent, are from domestic projects, while the remaining 10 percent are from international projects. The company’s current order book is 1.46 times more than its market cap of Rs. 15,062.36 crores.
Future Guidance:
The company expects revenue of around Rs. 10,000 crores for FY2026, although PAT margins are anticipated to drop to 5 percent due to increasing competition. For FY2025, order inflows are estimated at Rs. 2,700 crores, with an additional Rs. 1,000 to Rs. 1,200 crores expected by year-end.
The company expects standalone revenue for FY2025 to range between Rs. 10,000 to Rs. 11,000 crores, with PAT margins forecasted to decrease to around 6 percent, down from 7.12 percent last year.
Service Offerings:
IRCON is known for its expertise in railway construction, including electrification and signaling, road and highway building, commercial and residential complexes, airport infrastructure, and mass rapid transit systems. The company specializes in delivering high-quality infrastructure projects that support transportation and urban development across various sectors.
Strategic Focus:
The company is primarily focused on railway and road projects, with increasing interest in EPC projects in the road sector. To adapt to changing market conditions, the management is exploring opportunities to expand into various types of projects.
Business Operation:
The company has successfully completed over 1,650 major projects in India and more than 900 projects across over 31 countries, including Algeria, Bangladesh, and the United Kingdom
Recent quarter results and ratio:
Ircon International Limited’s revenue has decreased from Rs. 2,930 crore in Q3 FY24 to Rs. 2,613 crore in Q3 FY25, which has dropped by 10.82 percent. The net profit has decreased by 64.90 percent from Rs. 245 crore in Q3 FY24 to Rs. 86 crore in Q3 FY25.
Ircon International Limited’s revenue and net profit have grown at a CAGR of 20.78 percent and 15.63 percent, respectively, over the last five years.
In terms of return ratios, the company’s ROCE and ROE should be 18.2 percent and 16.4 percent, respectively. Ircon International Limited has an earnings per share (EPS) of Rs. 8.12, and its debt-to-equity ratio is 0.55x.
Written By – Nikhil Naik
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