A Rate Cut will Allow Infra Firms to Step on the Gas
Lower rates to help firms that are making losses because of high interest expenses despite strong order book & revenue visibility
Intelligence Group: Expectations of a rate cut are running high as the monetary policy will be announced on Wednesday. ETIG has culled out a list of infrastructure companies whose revenues have consistently grown in the past three years, but because of high interest expenses, earnings have been under pressure.
It has an order book of ₹ 4,579 crore of which over two-third is still to be executed, which adds to the revenue visibility. A large part of this order book is in roads and irrigation segments.
IRB INFRASTRUCTURE DEVELOPERS
IRB has an order book of over ₹ 12,011 crore. It is one of the few players, which are known for superior execution. It has 11 operational and 11 under construction, or partial tolling road, projects. The company has construction order book of ₹ 6,220 crore. In addition, through hybrid annuity model (HAM), it has construction order book of ₹ 1,600 crore. On the construction side, the company has an order book of ₹ 6,829 crore. Its subsidiary Sadbhav Infrastructure Projects has 12 road projects, which are generating toll revenue. It has focused on effective cost management. It has a construction order book of ₹ 5,750 crore, which spreads across sectors such as irrigation, marine and urban.