IRB Infra’s profitability margins have been trimmed

IRB Infrastructure Developers (IRB) has declared its Q4FY16 results on Thursday. The company’s net sales have increased by 55.16 per cent to Rs 1537 crore in Q4FY16 as compared to same period in previous fiscal. However, its EBITDA margin has contracted considerably and stands at 48.13 per cent in Q4FY16 against 57.61 per cent in Q4FY15. IRB’s net profit has increased by 9.36 per cent to Rs 151 crore in Q4FY16 on a yearly basis. The company’s net profit margin has contracted by 415 basis points to 9.84 per cent in Q4FY16 as compared to same period in previous fiscal year.

On the yearly front, IRB’s top line has increased by 33.34 per cent to Rs 5130 crore in FY16 as compared to previous financial year. The company’s EBITDA also has risen by 20.3 per cent to Rs 2661 crore in FY16 on a yearly basis. Its EBITDA margin stands at 51.86 per cent in FY16; while at 57.48 per cent in FY15. IRB’s interest expense has increased by 14.19 per cent to Rs 1063 crore in FY16 as compared to previous fiscal year. The company has posted net profit of Rs 636 crore in FY16 with a growth of 17.11 per cent. However, its net profit margin has contracted by 172 basis points to 12.39 per cent in FY16 on a yearly basis. IRB’s construction order book stands at approximately Rs 8000 crore, and this gives construction revenue visibility to IRB for the coming two and half years.

The share price of IRB has increased by 2.38 per cent on bourses in early trades; and is trading at Rs 220.45 on an intraday basis.

IRB is a road build–operate–transfer (BOT) operator. The company's construction business complements its BOT vertical by executing the engineering, procurement and construction (EPC); and operation and management (O&M) aspects of BOT concessions. Its business segments include Road Infrastructure Projects; Real Estate; and others. IRB has a portfolio of around 23 road BOT projects. Its road assets portfolio is across approximately eight states.