IRB Infra – Stock Analysis and Result Update

IRB Infra is one of the good stocks to buy from Infrastructure space. Let’s take a look at few facts about recent financial result that could make investment in this Infrastructure stock fruitful to investors.

Net result for IRB infra was definitely better that stock analyst’s expectations in market, but this was mainly due to lower depreciation number put on Surat – Dahisar highway. This adjustment made the BOT earnings in line with street’s expectations.

Construction earnings of company are better than expected numbers and this is due to higher EBITDA margins.

For 3QFY12, IRB Infra has reported 11.5% yoy revenue growth but at the same time, PAT has declined 1.2% yoy. National Highway Authority of India (NHAI) is expected to award road construction orders for 7300 kilometers of road in FY12. Similar orders are expected in FY13 as well. IRB Infra is considered to be one of the likely contenders for these orders and it is highly likely that company will achieve it’s annual target of orders worth Rs.5000 crores despite competition being high in this segment.

The stock has run up quite a bit from Rs.125 to Rs.176 in last one month itself. Longer term stock price target for IRB Infra could be Rs.212 to Rs.215 but do not euch to buy stocks of this counter right now. Wait for some price correction and then invest in it for one year time period for above mentioned target price. Price range of around Rs.140 would be ideal for buying stocks of IRB Infra if the stock corrects to those levels.

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