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    Ahluwalia Contracts (India) Limited

    AHLUCONTGood
    Construction·2 Jun 2025
    Management Summary

    Ahluwalia Contracts reported a steady Q4 FY25 performance with a 4.48% YoY turnover growth and a significant 51.44% increase in PAT (excl. exceptional items), driven by improved margins. The company concluded FY25 with a healthy order book of ₹15,775.08 crores and strong order inflow. Management provided a positive outlook for FY26, targeting 15% revenue growth and double-digit EBITDA margins, while acknowledging challenges like labor availability and project-specific delays.

    Highlights

    8

    • Q4 FY25 Turnover stood at ₹1,215.84 crores, marking a 4.48% YoY growth.

    • Q4 FY25 PAT (excluding exceptional items) increased by 51.44% YoY to ₹83.16 crores.

    • EBITDA margin for Q4 FY25 was 10.17%, up from 8.96% in Q4 FY24.

    • FY25 Turnover reached ₹4,098.62 crores, a 6.31% increase from FY24.

    • Order book as of March 31, 2025, was robust at ₹15,775.08 crores, providing 2-2.5 years of revenue visibility.

    • FY25 Order Inflow was strong at ₹8,436.69 crores.

    • Management guided for approximately 15% revenue growth and ₹7,000-8,000 crores in order inflow for FY26.

    • Capex for FY26 is projected at around ₹200 crores, primarily for high-rise building specialized machinery.

    Concerns

    1

    • Labor Availability and Wage Inflation

    What Changed1

    vs Q1 FY26

    Guidance items14 → 10 (-4)
    Key financials

    Metrics

    8

    Periods

    3

    Headline

    1
    • Order Book (as of Mar 31, 2025)
      ₹15,775.08 Cr

    Q4 FY25

    3
    • Turnover
      ₹1,215.84 Cr
      YoY+4.5%
    • PAT (excl. exceptional)
      ₹83.16 Cr
      YoY+51.4%
    • EBITDA Margin
      10.2%

    FY25

    4
    • Turnover
      ₹4,098.62 Cr
      YoY+6.3%
    • PAT (excl. exceptional)
      ₹201.51 Cr
      YoY-12.6%
    • EBITDA Margin
      8.3%
    • Order Inflow
      ₹8,436.69 Cr

    Guidance & targets

    9
    CategoryTargetPriority
    Revenue Growth
    Revenue growth
    15%
    		Medium
    Revenue Growth
    Revenue growth
    30% (₹6,000 crores)
    		Low
    Order Inflow
    Order inflow
    ₹7,000-8,000 crores
    		Medium
    Capex
    Capex
    ₹200 crores
    		High
    Project Execution
    CSMT project revenue
    ₹400-500 crores
    		Medium
    Project Execution
    Gems and Jewellery Park project start
    Q3 FY26
    		Low
    Project Execution
    Medical college at Chapra completion
    next six months
    		High
    Working Capital
    Working capital days
    Similar to 88 days
    		High
    Working Capital
    Interest-bearing mobilization advance percentage
    40%
    		High

    Risks & concerns

    6
    RiskSeverity

    Project Delays (CSMT, Gems & Jewellery Park)

    CSMT project faces design issues and work productivity challenges, leading to revised FY26 revenue guidance. Gems & Jewellery Park project start is delayed awaiting clearances. — Management acknowledged

    medium

    Labor Availability and Wage Inflation

    Labor is in extremely short supply, especially skilled workforce from Bihar (due to upcoming elections), impacting project performance and execution pace. — Management acknowledged

    high

    NGT Issues and Environmental Regulations

    Past NGT issues caused project delays; management expects lesser pain this year due to government steps but remains a watch item. — Management acknowledged

    medium

    Raw Material Cost Escalation

    Management states they are passing on costs and have mitigation strategies like owning a quarry and fabrication units for CSMT project. — Management acknowledged

    low

    Areas of Evasion(2)

    • Breakup of new orders vs. change in scope for order inflow
    • Specific percentage of new order inflow from private sector

    Q&A highlights

    3

    “Most of the design issues have been resolved. But in a project as complex as this... there continue to be issues... Secondly, work or productivity on the ground... is dependent on as and when closures or block closures are given to us. This year, substantially, we are looking to work on the greenfield aspect of the project... Hence, a bit of a downward trend on the revenue guidance that we are giving on this project for this financial year.”

    Reveals ongoing challenges with a flagship project, leading to a downward revision of FY26 revenue expectations for CSMT, impacting overall revenue guidance.

    asked by Vaibhav Shah

    2 min read6 chapters

    Detailed Narrative

    01

    Q4 & FY25 Financial Performance Overview

    Ahluwalia Contracts reported a Q4 FY25 turnover of ₹1,215.84 crores, a 4.48% increase year-on-year. PAT, excluding exceptional items📎, saw a significant 51.44% growth to ₹83.16 crores, with the EBITDA margin improving to 10.17% from 8.96% in Q4 FY24. For the full fiscal year FY25, turnover grew by 6.31% to ₹4,098.62 crores, although PAT (excl. exceptional items📎) declined by 12.62% to ₹201.51 crores, and the EBITDA margin stood at 8.34%.

    02

    Robust Order Book and Inflow

    The company's order book as of March 31, 2025, remained strong at ₹15,775.08 crores, providing revenue visibility for the next two to two and a half years. FY25 saw a healthy order inflow of ₹8,436.69 crores. Additionally, the company is L1 in two projects aggregating ₹1,796 crores, including a ₹1,000 crore university project in Bhubaneshwar and a ₹700 crore MIDC project in Mumbai, with Letters of Award expected within 30-45 days.

    03

    FY26 Outlook and Growth Drivers

    Management guided for approximately 15% revenue growth in FY26, with a targeted order inflow of ₹7,000-8,000 crores. They anticipate sustaining double-digit EBITDA margins, driven by the execution of new, higher-margin orders and the resolution of past slow-moving projects. Capex for FY26 is projected at around ₹200 crores, primarily for specialized machinery for high-rise building projects.

    04

    Working Capital and Financial Health

    Working capital days are expected to remain similar to the current 88 days in FY26. The interest-bearing component of mobilization advance has reduced from 58% last year to 40% in FY25, with the increase in total mobilization advance (₹639 crores in FY25) primarily coming from interest-free private sector projects. Trade receivables stood at ₹785 crores in FY25, and unbilled revenue was ₹390 crores.

    05

    Key Project Updates and Challenges

    The CSMT railway station project's FY26 revenue guidance was revised downwards to ₹400-500 crores (from an earlier ₹750 crores) due to ongoing design issues and phased work approvals, with completion expected in 2-2.5 years. The Gems and Jewellery Park project is awaiting clearances, likely to start in Q3 FY26. Other projects like DLF (housing and commercial), Signature Global, and Tata Memorial are progressing with steady or increasing monthly run rates.

    06

    Industry Dynamics and Risks

    Management highlighted labor availability and wage inflation as a significant challenge, especially with skilled workforce from Bihar potentially impacted by upcoming elections. While historical EBITDA margins of 12-13% are not expected in the post-COVID era, the company is confident in sustaining double-digit margins by passing on costs, aided by a scarcity of large, quality construction companies in the private sector. NGT issues are expected to have a lesser impact this year.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.