Cemindia Projects order momentum supports execution growth and margin expansion

Investment View

ICICI Securities’ November 9, 2026 results update on Cemindia Projects maintains a BUY recommendation and an unchanged target price of Rs 1,550. The broker’s thesis is that strong order inflows are beginning to translate into execution-led revenue growth, while the Adani group’s infrastructure capital-expenditure programme, healthy order visibility and higher-scale projects improve Cemindia Projects’ medium-term growth outlook.

Q2 FY27 Financial Performance

Cemindia Projects reported a good Q2 FY27 performance, according to ICICI Securities. Revenue rose 26.3 per cent YoY to Rs 2,748.7 crore and was broadly flat QoQ. EBITDA increased 31.7 per cent YoY to Rs 267.7 crore, with EBITDA margin expanding 40 basis points YoY to 9.7 per cent, although it declined 36 basis points QoQ. Reported PAT grew 21.7 per cent YoY to Rs 131.1 crore, but fell 6.9 per cent QoQ.

ICICI Securities notes that Q2 is usually weaker than Q1 and expects improved execution from new orders won in recent quarters. The broker expects full-year FY27 EBITDA margin of about 10.5 per cent.

Order Momentum and Execution Visibility

Order momentum is central to the investment case. Cemindia Projects reported year-to-date FY27 order inflow of about Rs 14,500 crore, compared with Rs 14,800 crore in FY26. ICICI Securities expects the company to comfortably achieve its FY27 order-inflow guidance of Rs 25,000 crore.

The external opportunity pipeline is Rs 1,30,000 crore, with a further approximately Rs 50,000 crore of opportunities from group entities. The order book was about Rs 35,000 crore in the broker’s discussion, equal to 3.3 times trailing 12-month sales versus 2.2 times YoY. Group entities accounted for 53 per cent of the order book.

QIP-Funded Capital Deployment

The company raised Rs 1,400 crore through a QIP, primarily to purchase tunnel boring machines. ICICI Securities believes this capital deployment can enable Cemindia Projects to pursue larger tunnelling opportunities inside and outside the group.

The company has guided for capital expenditure of Rs 150 crore in H2 FY27 and Rs 1,000 crore to Rs 1,500 crore in FY28. Net debt was Rs 320 crore, while net debt-to-equity improved to 0.12 times from 0.25 times.

Earnings Growth Outlook

ICICI Securities expects revenue to rise from Rs 10,007 crore in FY26 to Rs 12,492 crore in FY27E, Rs 17,082 crore in FY28E and Rs 19,965 crore in FY29E. It estimates EBITDA margin of 10.4 per cent in FY27E and 11.0 per cent in both FY28E and FY29E.

The broker forecasts a 27 per cent earnings CAGR over the next three years. Its expectations are supported by a book-to-bill ratio of about 3 times, robust FY27E order-inflow prospects, group capital expenditure and a 100-basis-point margin improvement from scale and larger projects.

Valuation and Target Price

The Rs 1,550 target price is based on FY28E PAT of Rs 1,072 crore valued at 25 times, plus Rs 2,000 crore of cash. This results in an equity value of Rs 28,600 crore across 18.4 crore shares.

The valuation incorporates QIP proceeds because the broker expects this cash to be deployed for growth. ICICI Securities argues that a higher multiple than peers is warranted by Cemindia Projects’ order momentum, 3.1-times order book, return on equity of about 28 per cent and low working-capital intensity.

Key Risks

• Lower-than-anticipated order inflows.
• Weaker execution.