PNC Infratech Limited
Q1 FY26
Call date · August 14, 2025
1 · Management Commentary
Key Positives
- Strategic entry into renewable energy (L1 for 300 MW Solar + 600 MWh BESS project) and coal mining (L1 for Rs. 3,489 crore Gevra OCP Expansion).
- Successful asset monetisation: Sale of 100% equity in PNC Bareilly Nainital Highways Pvt Ltd completed at an enterprise value of Rs. 716.2 crore; 11 of 12 assets under definitive agreement now divested.
- Robust order book: Unexecuted order book at over Rs. 17,000 crore as of June 30, 2025; including new wins, total order book exceeds Rs. 22,000 crore.
- Strong balance sheet: Standalone net worth Rs. 5,557 crore, net debt/equity 0.07x, net surplus Rs. 483 crore; consolidated net worth Rs. 6,421 crore, net debt/equity 0.73x, cash & bank balance Rs. 2,672 crore.
Key Negatives
- Q1 FY26 standalone revenue declined 13% YoY (Rs. 1,136 crore) due to high base effect (arbitration award and bonus in Q1 FY25) and project execution delays.
- Delays in appointed dates for four HAM projects (Rs. 5,000 crore) due to land acquisition issues; CIDCO project (Rs. 2,040 crore) halted and sub judice.
- Receivables remain elevated, especially in Jal Jeevan Mission (Rs. 700 crore) due to government fund delays.
Forward Guidance
- Capex plans: Rs. 450 crore for FY26 (including coal mining capex); no capex incurred in Q1.
- New products/segments: Focus on scaling renewable energy and coal mining; further bids in both segments underway.
- Expected client wins/losses: Targeting Rs. 7,000–10,000 crore additional order inflow in FY26, mainly from highways; bids worth Rs. 48,000 crore under evaluation.
- Revenue/margin outlook: Maintains 15–20% revenue growth guidance for FY26 (Rs. 6,300+ crore topline); 13% EBITDA margin guidance intact.
- Other strategic initiatives: Final asset monetisation (Challakere Karnataka Highways) expected in Q2 FY26; internal accruals sufficient for HAM equity infusion.
2 · Q&A Highlights
Q 1 (Revenue & Margin Guidance): Can you confirm revenue and margin guidance for FY26 and FY27 given Q1 de-growth and new project wins?
A (Management):
• Maintains 15–20% revenue growth for FY26 (Rs. 6,300+ crore); similar growth expected for FY27.
• 13% EBITDA margin guidance for FY26 remains intact.
Q 2 (Order Inflow & Pipeline): What is the order inflow target for FY26 and which segments are being targeted?
A (Management):
• Targeting Rs. 7,000–10,000 crore new orders in FY26, mainly highways; bids worth Rs. 48,000 crore (including one TOT project) under evaluation.
Q 3 (Coal Mining & Renewable Energy): What are the revenue, margin, and capex expectations for new coal mining and BESS projects?
A (Management):
• Coal mining: Rs. 3,489 crore project over 5 years; Rs. 400–500 crore capex; Rs. 600 crore annual revenue (Rs. 300–400 crore in FY26); 13% EBITDA margin.
• BESS: Over Rs. 2,000 crore EPC value; minimal revenue in FY26, major execution in FY27; Rs. 400 crore equity requirement (80:20 D/E assumed).
Q 4 (Project Execution Delays): What are the reasons for execution delays and when will pending projects commence?
A (Management):
• Delays due to land acquisition and appointed date issues (notably in Bihar); situation improved, expecting appointed dates for four HAM projects in Q2/Q3 FY26; CIDCO project (Rs. 2,040 crore) remains on hold (sub judice).
Q 5 (Receivables & Working Capital): What is the status of receivables, working capital, and mobilization advances?
A (Management):
• JJM receivables: Rs. 700 crore; irrigation: Rs. 90 crore.
• Net mobilization advance: Rs. 500 crore; working capital debt (standalone): nil.
Q 6 (Asset Monetisation): What is the status and cash realization from asset monetisation?
A (Management):
• 11 of 12 assets monetised; Rs. 2,050 crore received (Rs. 1,100 crore in standalone, balance in PNC Infra Holdings); final asset (Challakere) expected to close in Q2 FY26.
Q 7 (Balance Sheet & Key Metrics): Can you provide key balance sheet numbers as of June 2025?
A (Management):
• Inventory: Rs. 900 crore; trade receivable: Rs. 1,900 crore (HAM debtor: Rs. 730 crore); trade payable: Rs. 750 crore; retention money: Rs. 180 crore; unbilled revenue: Rs. 340 crore; standalone cash & bank: Rs. 483 crore; consolidated cash: Rs. 2,600 crore.
Q 8 (Order Book & Execution): What is the composition and execution outlook for the order book?
A (Management):
• Unexecuted order book: Rs. 17,000 crore (67% highways, 33% water/canal/area development); including new wins, total exceeds Rs. 22,000 crore.
• Four pending HAM projects expected to contribute Rs. 1,000+ crore revenue in FY26.
3 · Other Key Numbers
- Standalone Q1 FY26 revenue: Rs. 1,136 crore; EBITDA: Rs. 141 crore (12.4% margin); PAT: Rs. 81 crore (7.1% margin).
- Consolidated Q1 FY26 revenue: Rs. 1,423 crore; EBITDA: Rs. 367 crore (25.8% margin); PAT: Rs. 431 crore (30.3% margin).
- Aggregate bid project cost of 13 HAM projects: over Rs. 14,800 crore.
- Equity infused in HAM projects till June 2025: Rs. 1,019 crore; remaining equity to be infused: Rs. 725 crore over 2–3 years.
- Toll collections Q1 FY26: MP Highways Rs. 12.34 crore; Bareilly Nainital Rs. 19.65 crore; Narela Rs. 22.64 crore; Rae Bareilly annuity Rs. 32.16 crore.
- Irrigation outstanding order value: Rs. 866 crore; Kanpur-Lucknow Package 1: Rs. 67 crore; Package 2: Rs. 40 crore; Haryana Orbital Rail: Rs. 528 crore; Ganga Bridge: Rs. 230 crore.
- JJM execution target FY26: Rs. 900 crore; overall JJM backlog: Rs. 2,900 crore (to be completed by FY28).
- Arbitration award (Agra bypass): Rs. 485 crore (not yet received/recognized).
- Capex incurred in Q1 FY26: Nil.
- Kanpur highway tolling ended January 20, 2025 (no Q1 FY26 toll).
- Bonus on Hardoi project: Rs. 14 crore+ expected in Q2 FY26.
- Bids submitted for two more mining projects (aggregate value: Rs. 6,000–8,000 crore).
- TOT project bid: expected revenue over Rs. 30,000 crore over 20 years.
- No working capital constraints; gross block over Rs. 1,200 crore.
- Receivables cycle for new segments (mining/RE): payments expected to be timely, no significant working capital stretch anticipated.