CEMPRO

ITD Cementation reported a top-line of ₹2,250 crores for Q3 FY25, marking an 11% year-on-year growth compared to ₹2,017 crores in the prior year. Profit After Tax (PAT) also grew by 11% YoY to ₹87 crores. For the nine months ending December 2024, consolidated revenue reached ₹6,600 crores, a 21% YoY increase, with PAT surging 41% to ₹259 crores from ₹185 crores in the corresponding period last fiscal. The company maintained a healthy net debt-to-equity ratio of 0.4x.

The company's total work in hand stands at a robust ₹20,000 crores. During the first nine months of FY25, ITD Cementation secured new orders worth ₹6,370 crores and is L1 on additional orders exceeding ₹800 crores. The order book composition is diversified, with 50% from government projects, 42% from private clients, and 8% from PSUs. The bidding pipeline remains strong, with approximately ₹15,000 crores worth of tenders already submitted and another ₹15,000 crores yet to be submitted, including about ₹2,500 crores from overseas markets.

The Q3 FY25 revenue was significantly impacted by delays in the Bangladesh project, which could not commence work from August to September due to local political conditions. This resulted in an estimated revenue shortfall of ₹200 crores for the quarter. For the nine-month period, the project contributed only ₹150 crores against a budgeted ₹500 crores, leading to a ₹350 crore impact. These delays also contributed to the Q3 EBITDA margin compression to 9.5%, and management expects the revenue impact to continue into Q4 FY25.

For the first nine months of FY25, ITD Cementation incurred approximately ₹100 crores in capital expenditure. The full-year FY25 capex is projected to be in the range of ₹120-125 crores. Management indicated that future capex plans for FY26 are not yet finalized, as they will depend on securing large new projects that might require specific plant and machinery. The company continues to maintain a conservative financial position with a net debt-to-equity ratio of 0.4x, indicating a well-managed balance sheet.

With the impending finalization of the open offer, the new promoter is expected to drive significant opportunities. While there will be no immediate M&A activity, the company plans to pursue 'inorganic growth' by entering new segments such as green hydrogen, data centers, and other infrastructure areas where they currently lack a presence. Orders from the new promoter will follow the standard tender process, ensuring fair competition. The company is also actively pursuing international marine segment orders, with one expected soon and several tenders submitted.

ITD Cementation believes it possesses the necessary execution capabilities to handle an order book generating ₹13,000-14,000 crores in revenue annually without significant additional capex or manpower. The company is continuously upgrading its technical capabilities, moving from 50-60 tonnage piles to 300 tonnes per pile and utilizing 1,500-tonne cranes in floating conditions. This technological advancement is crucial for meeting shrinking project timelines and improving quality standards in the competitive infrastructure sector.