IRB Infra, Relaxo Footwears Q3 Results Review — HDFC Securities

IRB’s access to two InvIT platforms (IRB InvIT Fund and IRBIT) has previously facilitated capital unlocking through asset monetisation and the company has offered 5 BOT assets with Rs 150 billion EV to IRB public InvIT so as to unlock value..NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..HDFC Securities Institutional Equities.IRB Infra - Upcoming bid season key for re-rating IRB Infrastructure Developers Ltd. reported revenue/Ebitda/adjusted profit after tax of Rs 17.8/7.4/60 billion, beat/(miss) to our estimates of 5.9/-4.24/159% respectively. The order book as of December 2024 stood at Rs 315 billion, with EPC contributing 10% (Rs 32 billion) and operations and maintenance contributing 90% (Rs 283 billion). Moreover, in the long term, the company is expecting opportunities under the PPP mode for BOT projects worth Rs 2 trillion. IRB’s access to two InvIT platforms (IRB InvIT Fund and IRBIT) has previously facilitated capital unlocking through asset monetisation and the company has offered 5 BOT assets with Rs 150 billion EV to IRB public InvIT so as to unlock value. Total debt in these five assets is Rs 70 billion and with Rs 80 billion equity, it can bid for Rs 250 billion of new assets. Given the improving outlook on ordering and likely better toll growth in H2 FY25, we maintain our Add rating. We tweak our EPS estimates to factor in delay in project awards along with a slight revision in SOTP target price to Rs 67/share..Relaxo Footwears - Disappointing print; potentially at bottom of earnings cuts A combination of demand pangs and a revamp of its distribution system continues to weigh heavy on Relaxo Footwears Ltd.’s performance. Revenue declined by 6.4% YoY to Rs 6.67 billion in Q3 FY25 (our estimate: Rs 7.2 billion). Volume declined by 14.9% YoY. Gross margin improved 10 bps YoY but contracted 392 bps QoQ to 47.6% (our estimate: 50.2%). Ebitdam improved 27 bps YoY to 12.5% (our estimate: 13.2%). EBbitda/APAT declined by 4.3/14.4% YoY to Rs 834/330 million in Q3 (our estimate: Rs 947/416 million). Management expects distribution system to stabilise, and with it, volume growth within two-three quarters. We’ve cut our FY26/27 EPS estimates by 13/12% respectively, but we suspect Relaxo may be closer to the bottom of an earnings downgrade cycle and the risk-reward now seems favorable. Hence, we upgrade the stock to Add (from Reduce) with a DCF-based TP of Rs 600/share, implying 45x FY27E P/E..Click on the attachment to read the full report:.IRB Infrastructure Q3 Results: Net Profit Rises By 18% To Rs 222 Crore.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit. .Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

IRB Infra, Relaxo Footwears Q3 Results Review — HDFC Securities

The brokerage gives 'Add' rating to IRB Infra and 'Reduce' to Relaxo Footwears after Q3 Results, Here's why

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