PNC Infratech Shares Rise Nearly 5% After Q1 FY 2026-27 Results: Kotak Neo Retains Buy

PNC Infratech shares climbed as much as 4.84% to Rs220.58 as of 12:34 pm IST on Tuesday, August 11, up Rs10.18 on the day, after the company posted a sharp jump in June quarter earnings. The rally comes even as the stock remains well off its 52-week high of Rs325, having corrected 13.4% over the past month amid a broader slowdown in road sector awarding activity.

PNC Infratech Q1 FY 2026-27 At A Glance

PNC Infratech's standalone revenue grew 34% year-on-year to Rs1,518 crore in the June quarter, while profit after tax surged 235% to Rs271 crore. The sharp increase in profit was largely driven by a one-time settlement of Rs235 crore, including interest, received under the Vivad Se Vishwas III scheme in relation to the Agra Bypass EPC project.

Excluding the one-off, standalone net revenue grew 14.4% year-on-year, EBITDA increased 11.7% and profit before tax rose 17.4%. Adjusted EBITDA margin stood at 12.1%, down 30 basis points year-on-year but broadly in line with expectations.

According to Kotak Neo Research, execution improved from a weak base but remained below both its estimates and management's guidance of 30% revenue growth for FY27.

The company's unexecuted order book stood at over Rs19,100 crore as of the June quarter, equivalent to roughly four times its FY26 revenue and providing strong revenue visibility. The order book includes two new hybrid annuity model (HAM) projects secured during the quarter, along with recently awarded bridge, flyover and airport projects.

Management has retained its FY27 revenue guidance of around Rs6,000 crore, implying roughly 30% growth over FY26, and its FY28 guidance of around Rs7,500 crore, representing a further 25% increase. EBITDA margin guidance for both years remains at around 12%.

The company is targeting Rs15,000 crore in new order inflows in FY27. It has already secured around Rs3,500 crore in highway orders and roughly Rs2,000 crore in the solar segment.

PNC Infratech has also submitted bids worth close to Rs34,000 crore across 24 projects, while another 78 projects worth an estimated Rs2 lakh crore have been identified in its future bidding pipeline.

Kotak Neo Research Retains Buy, Trims Fair Value

The firm has retained its Buy rating on PNC Infratech but lowered its sum-of-the-parts-based fair value to Rs265 from Rs270 earlier. The revision factors in a minor 2% downgrade to FY28 earnings estimates following the Q1 results.

The research note values the standalone EPC business at around 12 times FY28 earnings and notes that the stock continues to trade below its historical average valuation multiples.

Kotak Neo Research said the slowdown in road-sector awarding activity has weighed on PNC Infratech's order inflows and backlog over the past year. Delays in appointed dates and weather-related disruptions have also affected execution.

With appointed dates now secured for major projects, the research note expects visibility for FY27 and FY28 to improve.

However, the show-cause notice issued by the National Highways Authority of India to the project's special purpose vehicle over damage to the Kanpur-Lucknow Expressway remains a key near-term overhang.

The research note highlighted uncertainty around a possible non-performance classification, potential debarment risk for the parent company, repair costs and toll losses.

Management has not quantified the potential financial impact or provided a timeline for reopening the affected section, citing an ongoing review. It has maintained that the damage was caused by heavy rainfall and that the repairs fall under routine contractual maintenance.

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