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IDBI Capital Report
HG Infra Engineering Ltd. Q4 FY24 operational result (revenue, Ebitda) came in line to our and consensus estimate. Revenue increased by +11% YoY and Ebitda margin was stable at ~16.2% versus 16.2% YoY.
Though order win for FY24 at Rs 43 billion was less than guided due to slow ordering amid election period. But inflow is expected to improve in FY25E and company guides Rs 110-120 billion order inflow in roads, railway, water segments.
Till there is pick up in ordering, FY24 order book provides revenue visibility at 2.4 times FY24 revenue.
We maintain Buy rating on the stock with revised target price at Rs 1,358 (earlier Rs 1,236 as we value HG Infra at 14 times FY26E EPS versus 12 times earlier).
Stock catalyst remains order win, for this HG Infra has bided for orders Rs 160 billion and is venturing into new sectors like solar renewable sector, water supply, tunnelling for inflow.
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