Detailed Narrative
Q2 FY26 Performance and Order Book Overview
Ramky Infrastructure reported a Q2 FY26 revenue of INR 444 crore. The company maintains a strong current order book of INR 9,200 crore. This order book is segmented with Industrial projects at INR 4,000 crore, Water wastewater at INR 2,700 crore, Building construction at INR 2,000 crore, and Urban Solutions & others contributing INR 500 crore. The EPC component of the total order book stands at INR 5,200 crore, while Operations & Maintenance (O&M) contracts account for INR 4,000 crore.
EBITDA Margins and Profitability Outlook
Management stated that Ramky Infra is among the top performers in its peer group with a current EBITDA margin of 22%. They aim to maintain EBITDA margins in the range of 21-22% on a sustainable basis, noting that HAM projects are significantly more profitable than typical EPC segments. The Q2 FY26 EBITDA, including other income, was INR 140 crore, translating to a margin of approximately 29.5% for the quarter.
Project Funding and Capital Expenditure
The recently awarded Hyderabad water HAM project has a job value of INR 2,085 crore, with an estimated CapEx of INR 1,600 crore. The funding structure for HAM projects typically involves 40% from the client during construction, with the remaining 60% met through a 30% equity and 70% debt mix. The company is in advanced stages of financial closure for this project, expecting completion by January 2026.
Bidding Pipeline and Growth Strategy
Ramky Infra has a robust bidding pipeline, estimated to be around $1 billion over the next twelve months, primarily in water wastewater and industrial solutions. The company is selective in its participation, focusing on projects where it can add significant value. The strategy is to maintain an order book visibility of 2.5x to 3x turnover, aiming for an order backlog of approximately INR 12,000 crore by FY27.
International Expansion and Industrial Parks
The company is actively pursuing international expansion, with a current focus on the Middle East and Africa for water and wastewater projects, particularly under the IPP model. Domestically, Ramky Infra is a leader in industrial park development, having established a pharma park in Andhra Pradesh. They are in advanced discussions with states like Maharashtra, Bihar, Telangana, and Himachal for large life sciences parks, expecting results in coming quarters.
Asset Monetization and Arbitration Updates
Regarding the Visakha Pharmacity, which is an asset for sale, the company is in discussions for documentation sharing and due diligence, with the transaction expected to conclude before March 2026. For the Srinagar Banihal Road project, claims are in an arbitration process, with results anticipated in the next year. Management considers the potential arbitration award to be sizable but refrained from disclosing the exact amount.
Ramky City Asset Status
The Ramky City project has 240 acres that are currently attached by the Enforcement Directorate (ED) and not yet released. This 240 acres is part of a larger 2,500-acre asset, with overall development investments made between 2005 and 2013. The company is expecting the release of the attached land but could not provide a specific timeline due to the ongoing legal process.