Fundamentals

IRB Infrastructure

Ticker : 532947
BUY: Rs 263.60
Target: Rs 305 

IRB Infrastructure Developers is infrastructure player involved in BOT space operating in the roads and highway sector. The company's revenue mix (Q3FY18), construction segment-64 per cent (Rs. 8593.2 crore) and the rest from BOT space (Rs. 4823.51 crore). IRB’s BOT portfolios include total length of around 7677 lane km as a BOT operator. Notably, the company’s construction order book currently stands at around Rs 15,300 crore, which gives revenue visibility for more than two years. Recently, the CBI has discharged IRB in a land grab case, this eliminates a key risk, which was an overhang on the stock. The momentum in order tendering activity from NHAI also augurs well for companies such as IRB Infra. Besides, transfer of assets to IRB InvIT has led to lean balance sheet of IRB Infra. 

ARVIND

Ticker : 500101
BUY: Rs 429.90
Target: Rs 477 

Arvind Ltd is engaged in the manufacture of high-end superfine fabrics. Its business segments include denims, woven fabrics, knit fabrics, garment exports and advance materials for growing industrial sectors like personal protection, etc. In recent quarters, the company achieved growth in fabric manufacturing to 60 mn mt vs 56 mn mt in Q3FY18. Further, the branded apparel business also witnessed traction with major brands like Tommy Hilfiger and Calvin Klein seeing 24 per cent revenue growth in QFY18. The company’s revenue for the quarter grew by 16 per cent to Rs.2705 crore in Q3FY18. Further, the EBITDA margin for the quarter declined to 9.2 per cent due to lower margins in textile business. Going forward, we see the demerger of brand & retail business will be value accretive and expect robust revenue growth and margin expansion on rupee depreciation.