Power Mech Projects Q3 Review: Nirmal Bang Maintains 'Hold' On The Stock, Lowers Target Price — Here's Why

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Nirmal Bang Report

Power Mech Projects Ltd.'s revenue and Ebitda margin were below our estimates by 6.4% and 158 bps, respectively.

Order inflow from Power: Non-power sectors stood at 89.3%:10.7% of the total.

Domestic: Power Mech secured orders worth Rs 42.4 billion in 9M FY25, with the total order backlog standing at Rs 579 billion as on Dec’25.

Power Mech has received forest land clearance from the Jharkhand Government for the Kotre Basantpur mine and the over-burden activity started during the quarter – a delay of about two months vs earlier expectation. The mining operations are expected to peak in FY27.

In FY26, Government of India's infrastructure spending is expected to boost project opportunities in sectors such as Power, Railways and Urban Infra, and expected private capex in domains of Steel industry, improving order book visibility.

We believe that the outlook over the medium term remains robust on the back of opportunities ahead and the scale-up in the mine developer and operator segment. Powe Mech’s margin profile is expected to improve gradually as the share of MDO revenue increases (margin accretive business).

We maintain Hold on Power Mech with a target price of Rs 2,023 valuing it at 12 times Dec’26E earnings. We continue to remain structurally positive on the business model over the medium to long term.

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