Vishnusurya

Vishnusurya Projects and Infra Limited reported strong performance for H1 FY26, with revenue reaching INR 170 crores, representing a 44% year-on-year growth. The company also achieved a positive cash flow from operations of INR 17 crores. Management expressed confidence in achieving a full-year profitability exceeding INR 50 crores for FY26. The Return on Equity (ROE) for H1 FY26 stood at 13.7%, and Return on Capital Employed (ROCE) was 17.4%.

The manufactured sand business is a key revenue stream, expected to contribute around 40% of the total revenue for FY26, with H2 FY26 mining revenue projected between INR 80-100 crores, leading to a full-year mining revenue of INR 140-150 crores. The company's plants operate at 70-90% efficiency, excluding rainy days. Strategic locations near national highways and major infrastructure projects like the INR 35,000 crores Tuticorin Port expansion and upcoming Chennai/Parandur/Hosur airports provide a competitive advantage in logistics and pricing power. The company holds substantial raw material reserves, estimated to last 7-10 years, allowing for capacity expansion by adding more machinery as demand grows.

The company is strategically focusing its EPC business on water and sewage projects, which are identified as major thrust areas by the government. These projects are expected to contribute around 60% of the EPC revenue. Vishnusurya prioritizes projects funded by international agencies (e.g., JICA) or the central government to mitigate credit risk associated with state and municipal bodies. Partnerships with established players like Jindal SAW further enhance capabilities and credibility in securing and executing these large-scale projects.

Vishnusurya has invested INR 59 crores in a joint venture with Brigade for a rental property of 140,000 square feet, expected to generate approximately INR 12 crores in annual rental income starting Q1 FY27. The company also holds significant land banks for its manufactured sand business in locations like Hosur, Aruppukottai, and Valaja. Management is open to monetizing these land assets if they appreciate significantly due to urban agglomeration, such as land in Hosur which has seen substantial value appreciation.

The waste management division is an aggressive growth area for Vishnusurya, with a revenue target of approximately INR 40 crores for FY26 and an expected growth rate of 20% upwards. The company has tied up with leading players and is actively identifying viable projects, including legacy waste management, geosynthetic applications, and wastewater treatment. This segment is seen as having fewer participants, offering significant growth opportunities.

The company maintains a strategy of limited debt requirements, supported by robust internal cash flows. The current cost of debt is between 9.5% to 10%. Recent fundraising efforts are primarily aimed at acquiring new mines to support the expansion of the manufactured sand business. An investment of INR 30 crores was made to acquire a 10% stake in the Tuticorin Desal Private Limited annuity hybrid project, with INR 5-5.5 crores allocated for bank guarantees and INR 25 crores for working capital over 1.5-2 years.