Ashoka Buildcon Limited — Investor Meet, 17-02-2025: Analysts/Institutional Investor Meet/Con. Call Updates

### Financial Performance

Ashoka Buildcon reported a total income of ₹1,816 crore for Q3 FY25, representing a decline of 16% from ₹2,162 crore in Q3 FY24. The EBITDA stood at ₹187 crore with a margin of 10.3%, while the PAT was ₹61 crore. For the nine months of FY25, total income reached ₹5,175 crore, down 3% from ₹5,309 crore in the previous year. However, EBITDA for this period grew by 4% to ₹493 crore, improving margins by 60 basis points to 9.5%. The consolidated results showed a total income of ₹2,426 crore in Q3 FY25, a 10% decrease from ₹2,699 crore, with an EBITDA of ₹677 crore, marking a 6% year-on-year increase and a significant 137% growth in PBT to ₹307 crore.

### Future Outlook and Growth Drivers

Management remains optimistic about growth driven by robust government infrastructure investments, with a budget allocation of ₹11.21 lakh crore for FY26. The focus includes significant bidding activities in road, rail, and power sectors. Revenue growth expectations are around 10%-15% for FY26, supported by a strong order inflow pipeline of ₹12,000 crore to ₹14,000 crore.

### Order Book and Operational Updates

As of December 31, 2024, the order book stood at ₹16,457 crore, with substantial contributions from road and railway projects. Recent project updates include receiving LOAs worth ₹1,391 crore and additional contracts totaling ₹5,470 crore. Provisional completion certificates for major projects reflect steady operational progress.

### Analyst Q&A Insights

- **Revenue and Profitability**: Management expects revenue for FY25 to remain flat, possibly slightly below last year's figures. They aim for EBITDA margins in Q4 to remain stable around 10%.

- **Market Position and Competitive Landscape**: With an anticipated strong bidding pipeline, particularly from NHAI, the company is strategically positioned to capture market opportunities.

- **Operational Challenges or Risks**: Management acknowledged challenges with rising interest costs but indicated confidence in managing them through asset disposals and optimizing operational efficiency.

- **Capex and Capital Allocation**: Plans to reduce debt significantly, projecting a decrease of approximately ₹4,000 crore by FY26, positioning the company for future growth investment opportunities.

- **Strategic Priorities and Long-Term Vision**: The firm emphasizes a balanced portfolio, with a strong focus on EPC capabilities across various infrastructure segments.

### Market or Regulatory Updates

Government incentives and infrastructure plans are expected to drive demand, reflecting a positive outlook for the company's strategic execution in upcoming periods.

### Strategic Focus Areas

Ashoka Buildcon is focusing on leveraging government plans for infrastructure expansion, technological adoption in project execution, and diversifying its project portfolio across various sectors to enhance competitiveness.

### Investor Insight

The observed financial health and future projections signal a potential upward trajectory for Ashoka Buildcon, aligning with a 'buy' perspective for investors looking at long-term growth in India's infrastructure sector.