IRB - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

🧠 My Thought Process

You're asking for a full-spectrum fundamental analysis of IRB Infrastructure Developers Ltd (IRB), with a numeric rating and strategic investment guidance. I’ve weighed profitability, capital efficiency, valuation, and business durability, and incorporated the latest financial updates and market sentiment from September 2025.

📊 Fundamental Analysis of IRB Infrastructure Developers Ltd

🔍 Core Financials

Profitability

PAT Qtr: ₹140 Cr vs ₹278 Cr — sequential decline, but YoY profit rose 44.6% to ₹202.4 Cr

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EPS: ₹9.29 — decent, supported by strong toll revenue growth.

ROE: 8.13%, ROCE: 7.21% — modest returns, typical for infra-heavy businesses.

Leverage & Liquidity

Debt-to-equity: 0.74 — significantly reduced from 2.62 in FY21 to 1.04 in FY25

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, showing improved capital structure.

Dividend Yield: 0.68% — consistent, with interim dividend of ₹0.07/share declared in August 2025

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Cash Flow & Stability

FY25 revenue: ₹7,613 Cr (↑43.7% from FY21)

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Net profit surged to ₹6,617 Cr in FY25 from ₹282 Cr in FY21 — driven by InvIT monetization and asset sales

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Operating cash flow remains positive, with ₹1,971 Cr in FY25

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📉 Valuation Indicators

Metric Value Interpretation

P/E Ratio 30.5 Overvalued vs industry PE of 20.6

P/B Ratio ~1.82 Reasonable given asset-heavy model

PEG Ratio 0.67 Attractive — undervalued relative to growth

Intrinsic Value ~₹48–₹52 Slight upside from current price

🛣️ Business Model & Competitive Edge

Segment Focus: Toll roads, BOT projects, and EPC contracts — long-term annuity income.

Moat: Largest private toll road developer in India with ₹80,000 Cr asset base across 12 states

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Growth Drivers

12% YoY toll revenue growth in August 2025

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COD achieved for VM7 Expressway project, eligible for ₹180 Cr annual annuity

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InvIT structure unlocking capital and reducing debt.

📈 Technical & Entry Guidance

Current Price: ₹44.1

DMA 50/200: ₹44.8 / ₹48.7 — trading below long-term average, indicating weakness.

RSI: 52.9 — neutral zone.

MACD: -0.45 — mild bearish crossover.

🎯 Entry Zone

Ideal Buy Range: ₹41–₹43 — near 52-week low.

Stop Loss: ₹38

Target: ₹52–₹55 in medium term

🕰️ Long-Term Holding Outlook

Hold if invested: Strong asset base, InvIT monetization, and toll growth support long-term value.

Buy on dips: Preferably near ₹42 zone.

Growth Triggers: New project CODs, annuity inflows, and debt reduction.

⭐ Fundamental Rating

4.1

Let me know if you'd like a peer comparison with Ashoka Buildcon or KNR Constructions next!

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