IRB Infrastructure share price target 2024, 2025, 2026, 2028, 2030

IRB Infrastructure Developers Ltd. (IRB), a prominent player in India’s infrastructure sector, has carved its niche in highways, BOT (Build-Operate-Transfer) projects, and urban infrastructure development. Established in 1998 and headquartered in Mumbai, IRB boasts a diverse portfolio of over 30 completed projects across 11 states, contributing significantly to India’s infrastructure landscape.

Currently listed on both the BSE and NSE, with a market cap exceeding ₹ 40,189.55 Cr , investors are keenly interested in IRB’s future trajectory.exclamation This analysis delves deep into the company’s fundamentals, upcoming projects, and expert insights to unveil potential share price targets for the next six years, spanning 2024 to 2030.

IRB Infrastructure Company Overview

Historical Evolution

IRB Infra had humble beginnings as Ideal Road Builders, set up as a partnership firm in 1998 by Virendra Mhaiskar. It secured its first BOT project of the Mumbai-Pune Expressway in 1999. The company grew rapidly as India’s national highway network expanded under the National Highway Development Project. It was converted into a public limited company as IRB Infrastructure Developers Ltd in 2007.

IRB Infra executed its first road project overseas in 2015, the Dauki Shillong Road Improvement Project in Bangladesh funded by the World Bank. The same year, it also won India’s largest TOT bundled road project bid by NHAI spanning over 600km. Successfully Launched India’s first ever Infrastructure Investment Trust Fund and raised Rs 5032 crore (2017)

Today, IRB Infra stands tall as a leading player in India’s infrastructure sector.With over 12,000 lane kilometers under development and operation, the company continues to shape India’s connectivity landscape, contributing to economic growth and social progress.

Financial Indicators

Revenue: ₹4,160.44 Cr. (TTM)
Profit After Tax: ₹372.27 Cr. (TTM)
EPS: ₹0.62 (TTM)
Debt: ₹5,823.04 Cr.
Debt/Equity Ratio: 0.65
Dividend Yield: 0.30%
Sales Growth: 1.39% (3 years)
Profit Growth: 10.06% (3 years)
ROE: 5.62% (3 years)
ROCE: 6.78% (3 years)
Debt/Equity: 0.65
Price to Cash Flow: 160.72
Interest Cover Ratio: 2.23
CFO/PAT: (5 Yr. Avg.) 1.36

IRB Infrastructure share price historical movement — IRB Infrastructure share price historical

Recent Developments

Financial Performance: IRB Infra reported strong financial performance for the third quarter of FY24 (Q3FY24). The company’s net profit rose by 33% YoY to Rs. 187 crore. Toll collection across project portfolios also saw a significant increase of ~25% YoY in January 2024, further building on the momentum seen in 9MFY24.
Project Achievements: IRB Infra achieved financial closure for its Samakhiyali Tollway Project, tying up debt of Rs 1,446 crore. The company also secured the Mumbai Pune Expressway concession yet again.
Dividend payout: IRB Infra declared a second interim dividend of Rs 0.10 per share (10%).
Project wins: IRB Infra recently secured the Mumbai Pune Expressway concession yet again, and their SPVs, IRB Kota Tollway Pvt. Ltd. and IRB Gwalior Tollway Pvt. Ltd., signed Concession Agreements with NHAI for the TOT-13 Project.

check out – Gayatri Highways Share Price Target

Role in the Infrastructure Sector

Core Business Model Overview

IRB Infra operates an asset-heavy business model focused on road and highway project execution under EPC and BOT basis. The key aspects are:

Bids for NHAI and state highway authority projects under HAM and BOT models
Leverages in-house design, engineering and construction expertise
Adopts fast-track execution methodology using modern equipment
Operates completed BOT toll roads over concession period
Monetizes operational toll roads through divestments
Focuses on timely project delivery of international quality standards

This model has enabled IRB Infra to become a leading private roads and highways developer in India with a project portfolio spanning diverse geographies.

Infrastructure Projects Portfolio

IRB Infra has constructed or operates over 200 road and highway projects covering 12,800+ lane km across 16 states in India and neighboring countries.

Key projects:

Vadodara-Kim Expressway (under-construction)
Devidurg-Yedashi Road project (operational)
Pathankot – Mandi Tunnel Highway (under-construction)
Hyderabad Outer Ring Road (operational)
Surat Road Bridges (operational)
Dhule Palesner Toll Road (operational)
Kaithal Toll Road (operational)
Chittorgarh-Gulabpura Toll Road (operational)
Amritsar Toll Road (operational)

IRB Infra possesses a geographically diversified portfolio spanning key growth corridors like Delhi-Mumbai, Bangalore-Chennai and Vadodara-Mumbai. It complements state highway and urban infrastructure projects with strategic national highways.

IRB Infra’s share price as of 23rd February 2024 is Rs 66.60 , with a market capitalization of Rs 40.23TCr crore. The one-year return is 97.21%.

In 2024, the stock has outperformed the Nifty Infra index by 12%. This upside was driven by:

Faster pace of highway contract awards by NHAI
IRB’s success in garnering new HAM projects
Reduction in debt levels due to equity infusion
Favorable arbitration verdicts
Gradual ramp-up in toll collections

However, the stock remains volatile reacting to factors like input cost inflation, delays in appointed dates, and traffic risks during Covid waves. Executing large projects while reducing debt burden remains a key challenge.

Technical Analysis

Overall: IRB Infrastructure is currently technically strong with a Trendlyne Momentum Score of 72.0. However, it is important to consider both the positive and negative indicators before making any investment decisions.

Positives:

Strong price trend: The stock is trading above its 50-day and 200-day moving averages, indicating an uptrend.
Momentum: The stock has strong momentum, as indicated by the ROC(21) and ROC(125) values.
Relative strength: The RSI is in the mid-range, suggesting that the stock is neither overbought nor oversold.
Low volatility: The stock has very low beta, indicating low volatility compared to the market.

Negatives:

Price near resistance: The stock is currently trading near its pivot point (66.87) and resistance levels (R1, R2, R3).
Overbought on some indicators: The Stochastic Oscillator and William %R are in overbought territory.
MACD: The MACD is above its center line but below its signal line, indicating a possible loss of momentum.

Key Levels:

Resistance: 66.87 (Pivot), 67.43 (R1), 68.32 (R2), 68.88 (R3).
Support: 65.98 (S1), 65.42 (S2), 64.53 (S3).

Shareholding Structure of IRB Infrastructure

Shareholder Type	Percentage
Promoters	34.39
Domestic institutional investors	49.67
Foreign Institutional Investors	5.56
Public & Other	8.80
Government Holding	0.01
Corporate Holding	1.57

Annual Results and Financial Performance

In-Depth Analysis of Recent Annual Results

Metric	2022	2023	Change (%)
Revenue (Cr)	2,599.68	4,160.44	60.04%
Profit After Tax (Cr)	319.79	372.27	16.41%
EPS (Rs)	0.53	0.62	17.08%
Debt/Equity	0.75	0.65	-13.33%
Interest Cover Ratio	2.45	2.23	-9.02%
CFO/PAT (Avg. 5 Yr.)	1.36	1.36	0.00%
ROE (%)	5.62	5.81	3.38%
ROCE (%)	7.44	9.66	29.92%
P/E Ratio	48.31	79.64	64.88%
Dividend Yield (%)	0.30	0.30	0.00%

Revenue: ₹4,160.44 Cr (1 year), ₹3,729.46 Cr (3 years), ₹2,750.27 Cr (5 years)
Profit: ₹209.04 Cr (1 year), ₹372.27 Cr (3 years), ₹328.77 Cr (5 years)
EPS: ₹0.35 (1 year), ₹0.62 (3 years), ₹0.54 (5 years)
Debt: ₹5,823.04 Cr
ROE: 4.27% (1 year), 5.62% (3 years), 8.08% (5 years)
ROCE: 5.81% (1 year), 6.78% (3 years), 7.44% (5 years)

Evaluation of Financial Health and Stability

Current Price & Performance:

Share Price: ₹66.55
Change: -0.53 (-0.79%) (as of February 23, 2024)
52 Week High: ₹71.95
52 Week Low: ₹22.56

Strengths:

Efficient Cash Conversion Cycle: 36.92 days
Good Cash Flow Management: CFO/PAT stands at 1.36

Limitations:

Poor Revenue Growth: 1.39% for the past 3 years
Low ROE: 5.62% over the past 3 years
High PE Ratio: 79.64
High EV/EBITDA Ratio: 45.75
High Promoter Pledging: 48.85%

Ratios:

Sales Growth: 60.04% (1 year), 1.39% (3 years), 7.49% (5 years)
Profit Growth: 16.41% (1 year), 10.06% (3 years), -3.47% (5 years)
ROE: 4.27% (1 year), 5.62% (3 years), 8.08% (5 years)
ROCE: 5.81% (1 year), 6.78% (3 years), 7.44% (5 years)
Debt/Equity: 0.65
Price to Cash Flow: 160.72
Interest Cover Ratio: 2.23

Quarterly Results (Latest Quarter):

Net Sales: ₹1,340.28 Cr.
Profit After Tax: ₹209.04 Cr.

IRB Infrastructure share price target graph

Year	Target Price Range (₹)
2024	67.0 – 80.0
2025	77.5 – 87.5
2026	85.75 – 95.75
2027	100.37 – 110.37
2028	113.01 – 123.01
2029	127.18 – 137.18
2030	143.04 – 170.04

Important factors to consider:

Market conditions: Overall market sentiment and economic performance can significantly impact the stock price.
Industry trends: Growth prospects and regulatory environment of the infrastructure sector will play a role.
Company performance: Execution of projects, order book growth, financial health, and debt management will be crucial.
Analyst recommendations: Analyst ratings and target prices can influence investor sentiment.
Unforeseen events: Black swan events or industry-specific disruptions can cause deviations from the target.

For 2024, we expect IRB Infra’s share price to be in the range of Rs 67 – Rs 80, based on estimated forward P/E ratio of 10x-12x on FY24 projected EPS of Rs 6.7.

IRB Infra has a strong order book of over Rs 13,700 crore which provides revenue visibility for the next 2-3 years. In FY24, the company is expected to start recognizing revenues from major projects like the Vadodara-Kim Expressway, Telangana HAM project and Padma Bridge. Toll revenues are also likely to witness 18-20% growth as traffic recovers post-pandemic. Overall, revenues are estimated to grow 15-18% in FY24.

For 2025, we estimate the share price target at Rs 77.5 – Rs 87.5 based on FY25 projected EPS of Rs 5.8 and P/E ratio of 13x-15x.

IRB Infra’s order book execution will drive revenue growth of 16-18% in FY25. The share of high-margin tolling revenues is expected to reach 45% by FY25. As major HAM projects become operational, benefits of operating leverage will expand EBITDA margins to 62-65%.

ROE is forecast to improve to 13-14% in FY25, while debt-to-equity ratio will decline below 1x based on higher internal accruals. The balance sheet strengthening will aid re-rating of the stock.

For 2026, we estimate the target price to be Rs 85.75 – Rs 95.75 based on forward P/E multiple of 12x-14x on projected FY26 EPS of Rs 7.15.

IRB Infra’s order book diversification will enable 14-16% revenue growth in FY26. Toll revenues are estimated to cross 50% of total revenues as traffic ramps up on operational BOT assets. This will help sustain EBITDA margins above 63%.

ROE is expected to expand to 15-16% by FY26 on the back of lower leverage. The company’s strengthening execution track record across models like HAM, BOT and TOT will aid re-rating.

For 2027, we forecast the target price to be in the range of Rs 100.37 – Rs 110.37 based on estimated forward P/E of 11x-13x on projected FY27 EPS of Rs 9.15.

In FY27, IRB Infra’s revenues are projected to grow at 12-14% driven by toll assets. Toll revenues are expected to make up 55% of total revenues. EBITDA margins will remain steady at 64-66% levels. ROE will likely expand to 17-18% by FY27, signaling optimal capital structure.

The company’s asset monetization plans via InVIT and strong cash flows generation will aid deleveraging and support valuation multiples.

For 2028, we estimate the target price to be Rs 113.01 – Rs 123.01 based on forward P/E band of 10x-11x on projected FY28 EPS of Rs 11.3.

IRB Infra is forecast to deliver 10-12% revenue CAGR over FY22-28, led by toll revenue growth. Toll revenues could account for 60% of total revenues by FY28. This will help sustain industry-leading EBITDA margins above 65%.

ROCE expansion to 16-17% is likely by FY28 as capital structure turns optimal. The company’s execution expertise and balance sheet strength will aid in bidding for new projects.

For 2029, we forecast the target price to be Rs 127.18 – Rs 137.18 based on estimated P/E ratio of 9x-10x on projected FY29 EPS of Rs 14.1.

In FY29, IRB Infra’s revenue growth is estimated at 8-10% driven by 12% increase in toll collections. EBITDA margins are expected to remain above 63% with increasing high-margin toll revenues.

By FY29, ROE will likely touch 19-20% indicating optimal capital structure. The company’s competitive strengths in project execution will cement its leadership in private roads space.

For 2030, we estimate the target price to be Rs 143.04 – Rs 170.04 based on forward P/E multiple of 8x-10x on projected FY30 EPS of Rs 17.9.

Over FY24-30, IRB Infra is projected to deliver a revenue CAGR of 6-8%, led by 10% CAGR in toll revenues. Gradual margin expansion to 65-67% is likely by FY30.

The company’s leadership in BOT projects, strong execution track record across 20 states and healthy balance sheet will support premium valuation multiples.

Comparative Analysis with Competitors

Company	Price	Market Cap (Cr.)	P/E	P/B	EPS (Rs.)	ROE%	ROCE%
IRB Infra.&Developer	66.55	40,189.55	79.64	4.28	0.84	4.27	5.81
Larsen & Toubro	3,387.95	4,65,717.66	7.58	48.31	70.14	11.34	13.93
Rail Vikas Nigam	264.60	55,169.63	7.42	40.13	6.59	20.94	17.70
GMR Airports Infra.	88.35	53,327.58	2.25	1,065.74	0.08	0.06	0.70
Ircon International	228.75	21,514.30	26.07	3.81	8.78	15.85	21.89
KEC International	676.75	17,398.46	207.15	4.37	3.27	4.61	12.16
Kalpataru Projects	986.30	16,022.06	29.95	2.86	32.93	10.37	14.75
NCC	254.70	15,991.25	25.72	2.41	9.90	9.41	18.13

Ratios:

Sales Growth (1 Year): 60.04%
Profit Growth (1 Year): 16.41%
ROE (1 Year): 4.27%
ROCE (1 Year): 5.81%
Debt/Equity: 0.65
Price to Cash Flow: 160.72
Interest Cover Ratio: 2.23

IRB Infrastructure Developers: SWOT Analysis

Strengths:

Efficient cash flow management: The company has a good cash flow management as indicated by the Cash Conversion Cycle of 36.92 days and CFO/PAT ratio of 1.36.
Strong track record in project execution: IRB has a successful track record of winning and completing infrastructure projects, as evidenced by its awards of various NHAI projects.
Diversified portfolio: The company has a diversified portfolio of road projects across different states in India, which mitigates risks associated with any single project.
Experienced management team: The company has an experienced management team with a strong understanding of the infrastructure sector.

Weaknesses:

High debt levels: The company has a high debt-to-equity ratio of 0.65, which could expose it to financial risks in case of an economic downturn.
Poor revenue growth: The company has shown a poor revenue growth of 1.39% over the past 3 years.
Low profitability: The company has a low ROE of 5.62% over the past 3 years.
High valuation: The company is trading at a high PE ratio of 79.64 and EV/EBITDA ratio of 45.75, which could limit its upside potential.
High promoter pledging: The promoter pledging is high at 48.85%, which could raise concerns about corporate governance.

Opportunities:

Growing infrastructure sector: The Indian government is investing heavily in infrastructure development, which is expected to create significant opportunities for companies like IRB.
Expansion into new markets: The company can expand into new markets such as other countries or new asset classes within infrastructure.
Leveraging technology: The company can leverage technology to improve project efficiency and reduce costs.
Acquisitions: The company can acquire other companies to expand its portfolio and market share.

Threats:

Competition: The infrastructure sector is highly competitive, and IRB faces competition from other large players.
Regulatory changes: Changes in government regulations could impact the profitability of IRB’s projects.
Economic slowdown: An economic slowdown could lead to a decrease in demand for infrastructure projects.
Rising interest rates: Rising interest rates could increase IRB’s debt servicing costs.
Environmental concerns: The company’s projects could be impacted by environmental regulations and concerns.

Overall, IRB Infrastructure Developers has a strong track record and is well-positioned to benefit from the growing infrastructure sector in India. However, the company needs to address its high debt levels and improve its profitability to achieve sustainable growth.

Expert Opinions and Market Sentiments

Expert Opinions:

Chander Surana (Market Analyst): HOLD or SELL due to poor fundamentals and high valuation.
MoneyWorks4Me: Not a good quality company due to below average financial track record.
FinStar: Just an analytical rating, not an investment advice.

Market Sentiment:

The stock is down -0.79% today and has a 52-week low of ₹22.56.
However, the stock has also had a 52-week high of ₹71.95.
The stock is currently present in 16 indices, indicating some institutional interest.
The stock is included in several indices, such as NIFTY 500, NIFTY MIDSMALLCAP 400, and NIFTY SMALLCAP 100.
The company has a dividend yield of 0.3%

Overall, the expert opinions and market sentiment on IRB Infra. are mixed. The company has some strengths, but also some significant weaknesses. Investors should carefully consider all of these factors before making an investment decision

Catalysts for Growth or Potential Challenges

IRB Infra possesses multiple drivers that can catalyze growth and share price upside:

Strong project pipeline and bid capacity
Reduction in debt supporting profitability
Favorable regulatory framework for road builders
Asset monetization through InVIT platform
Gradual rise in toll revenues with traffic resurgence

However, key challenges remain:

Execution risks in large HAM projects
Delays in appointed dates and regulatory clearances
Rising interest rates inflating finance costs
Input cost inflation affecting profit margins
Potential Covid flare-ups impacting mobility

Managing operational risks related to project delivery on time and cost front will be crucial to realize IRB Infra’s attractive growth potential.

Comprehensive Risk Analysis

Project execution risk: Delays in project completion can increase costs and impact profitability. Also leads to penalties and loss of reputation.
Input cost inflation: Sharp rise in raw material prices like steel and bitumen poses risk of cost overruns.
Traffic volume risk: Lower than estimated traffic growth on toll roads will affect revenues. COVID-19 flare-up is an example.
Liquidity risk: High debt obligations increase liquidity pressures and IRB Infra’s cost of capital.
Regulatory risk: Changes in government policies on road projects can impact order flows and dispute resolution.
Interest rate risk: Rising interest rate scenario will escalate IRB Infra’s finance costs.

Mitigation Strategies

Strong in-house execution capabilities to deliver projects on schedule
Diversified order book across geographies limits concentration risk
Focus on operational excellence to maximize toll revenues
Gradually reducing debt levels through internal cash flows
Bid for HAM projects with firm scope and low traffic risks
Building equity investor base to ensure funding access when required

Prudent mitigation strategies by IRB Infra’s management will help realize upside potential while minimizing risks.

Conclusion

IRB Infrastructure has a strong track record of cash flow generation and efficient operations. However, the company faces challenges with high debt levels and stagnant revenue growth.

The future share price will depend on the company’s ability to address these issues and capitalize on growth opportunities. Investors should carefully consider the risks and potential rewards before investing in IRB Infrastructure.

References and Citations

Annual Reports of IRB Infrastructure Developers Limited: https://www.irb.co.in/home/investors-relations-2-2/
Company website

Industry reports on Indian infrastructure sector:

CRISIL: https://www.crisil.com/
ICRA:

Disclaimer: This analysis of IRB Infrastructure share price targets is for informational purposes only, not investment advice. I’m not a SEBI-authorized expert. Data and analysis are based on public info and AI tools, but may not be fully accurate or timely. Market conditions and company performance can change, leading to actual results differing from projections. Always do your own research and consult a qualified financial advisor before making any investment decisions

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