Buy IRB Infrastructure; target of Rs 271: Kotak Securities

November 17
20:42 2017

Kotak Securities’ research report on IRB Infrastructure

Revenues of the company for Q2FY18 were slightly lower than our estimates due to lower than expected toll revenues. BOT revenues are not comparable due to transfer of assets to InVIT. Consolidated operating margins witnessed an improvement due to higher other income accrued in the EPC/BOT segment owing to transfer of projects to InVIT as well as dividend income from InVIT. Net profit performance stood ahead of our estimates led by fall in interest expense and higher other income despite higher tax rate for the quarter.

We revise our estimates to factor in transfer of Amritsar-Pathankot project and arrive at a revised price target of Rs 271 on FY19 estimates (Rs 284 earlier). We continue to remain positive on the stock and maintain BUY rating on IRB Infrastructure.

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