Ramky Infra Q1 FY26: Profit Rises 10%, Revenue Falls 33%

Ramky Infrastructure Limited announced its Q1 FY26 results on 8th August 2025, posting a mixed performance. The company reported a 10.09% YoY increase in consolidated profit after tax (PAT) to ₹74.40 crores, but revenues contracted sharply by 33.36% YoY to ₹379.24 crores.

The results highlight the company’s ability to sustain profitability despite lower execution volumes, though standalone performance revealed greater stress, with both revenue and profit declining significantly.

1. Company Overview

Ramky Infrastructure is a Hyderabad-based construction and infrastructure development company engaged in engineering, procurement, and construction (EPC) projects across roads, irrigation, water supply, power, and industrial sectors. It has played a vital role in India’s infrastructure growth, though it operates in a highly competitive and capital-intensive industry where margins are often thin and execution cycles are long.

2. Extracts of Q1 FY26 vs Q1 FY25 Results

Consolidated Performance

Standalone Performance

(Figures in crores)

3. Key Highlights of Q1 FY26

• Consolidated Revenue: ₹379.24 crores, down 33.36% YoY.

• Consolidated PAT: ₹74.40 crores, up 10.09% YoY.

• Standalone Revenue: ₹354.08 crores, down 35.64% YoY.

• Standalone PAT: ₹55.58 crores, down 35.68% YoY.

• Operational Performance: Consolidated profit growth was supported by subsidiaries and joint ventures, offsetting weakness in standalone operations.

4. Revenue Decline

The steep decline in revenue underscores challenges in project execution:

1. Project Delays: Infrastructure projects often face delays due to land acquisition, regulatory hurdles, or funding bottlenecks.

2. Lower Order Book Conversion: Slower pace of converting orders into billable revenues.

3. Sectoral Headwinds: Broader slowdown in construction activity may have weighed on performance.

5. Profitability Trends

Despite falling revenues, consolidated PAT rose 10.09% YoY, suggesting:

• Better Cost Control: Improved efficiency and disciplined expense management.

• Higher Contribution from Subsidiaries: Non-standalone operations provided resilience.

• Margin Focus: Even with lower top-line, profitability was preserved.

However, standalone PAT plunged 35.68%, reflecting stress at the core EPC operations level.

6. Share Price Performance

On 28th August 2025, Ramky Infrastructure’s stock opened at ₹562.50 per share and slipped slightly to ₹561.40 per share, mirroring cautious investor sentiment.

Long-Term Returns

• 1-Year: -20.58% → weak near-term performance.

• 5-Year: +1,499.43% → significant multi-bagger returns.

• Since Listing (Max): +44.91% → moderate long-term gains.

The stock shows extreme divergence between short-term weakness and long-term outperformance.

7. Analyst Expectations

Analysts view the Q1 performance as stable on profitability but concerning on revenue growth.

• Upside Target: ₹600.20 per share in the next 12 months if execution improves.

• Downside Risk: ₹500.60 per share in case of continued project delays or sectoral weakness.

• Investment Advisory: Analysts urge caution, recommending investors account for volatility and execution risks before entering the stock.

8. Sector Context

India’s infrastructure sector is poised for growth, supported by:

• Government Capex Push: Large-scale investments in roads, irrigation, and power.

• Urbanization: Rising demand for housing, water, and transportation projects.

• Public-Private Partnerships (PPPs): Expanding opportunities for EPC firms.

At the same time, challenges persist:

• High Working Capital Needs strain balance sheets.

• Execution Delays remain a common risk.

• Competitive Bidding pressures margins across the industry.

Ramky Infrastructure must balance opportunities with these sectoral headwinds.

9. Risks for Investors

1. Execution Risk: Delays in project timelines can impact revenues.

2. Sector Volatility: Highly sensitive to government spending and policy changes.

3. Debt Burden: Infrastructure companies often carry high leverage, impacting cash flows.

4. Cyclical Nature: Dependent on broader economic cycles and capex trends.

10. Opportunities Ahead

1. Rising Capex: India’s continued infrastructure investments offer strong growth visibility.

2. Diversified Portfolio: Exposure across roads, irrigation, water supply, and industrial projects.

3. Potential Order Wins: Government tenders may boost the order book in coming quarters.

4. Improved Profitability Focus: Q1 FY26 PAT growth indicates management discipline on cost structures.

11. Investor Outlook

• For Traders: Stock may offer opportunities with upcoming order announcements and earnings momentum.

• For Long-Term Investors: Despite short-term weakness, Ramky’s proven ability to deliver multibagger returns makes it a high-risk, high-reward play.

• Neutral View: Accumulation on dips may suit investors with higher risk tolerance and a long-term horizon.

Conclusion

Ramky Infrastructure’s Q1 FY26 results reflect a mixed quarter. While consolidated PAT rose 10.09% YoY to ₹74.40 crores, revenue fell sharply by 33.36% YoY, highlighting execution challenges. Standalone numbers show deeper stress, with both revenue and profits declining significantly.

The stock has corrected in the short term but remains a long-term wealth creator, delivering 1,499% returns over 5 years. With analysts projecting an upside target of ₹600.20 per share, Ramky Infrastructure remains attractive for risk-tolerant investors, though execution risks and volatility must be carefully considered.

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