‘buy’ IRB Infra – Target Price Rs.240

 Buy rating on IRB Infra is maintained with a target price of Rs.240 over one year, as against
the earlier target price of Rs.250.
 With the sale of 30 million shares of the promoter group, the overhang of distressed sale of pledged shares has been significantly reduced.
 The chairman of the company along with his family has increased their stake in the company to 60%.
 As the overhang on pledged shares is substantially removed, investors could now focus on
fundamentals, which are strong in this weak environment.
 Any project win from its Rs.16 billion plus project bid pipeline, earning surprise from its construction business or interest cost savings would be positive catalysts for the stock.
 Goa project is excluded from estimates because of persisting uncertainties over land
acquisition and the target price has been reduced to Rs.240 from Rs.250.
 Risks to the target price are lower than expected growth in traffic or daily collections in new projects, lower EPC margins, project delays etc.