Dilip Buildcon (DBL IN) – Q2FY27 Result Update – H2FY27 guidance at 50% revenue growth – ACCUMULATE

DBL reported a largely in-line Q2FY27 performance, with revenue growing 19.0% YoY and EBITDA increasing 14.6% YoY, while EBITDA margin moderated to 10.4% (down 40bps YoY). PAT grew 28% YoY to INR 0.52bn, despite a high base that included an exceptional gain of INR 0.42bn in Q2FY26. Order inflows of INR 73.2bn during the quarter propelled the order book to a record INR 330.8bn (~4.6x TTM revenue). Including ~INR 13bn of orders secured post Q2FY27, DBL has already achieved ~90% of the lower end of its FY27 inflow guidance of INR 100–120bn. DBL has entered into an agreement with Alpha, under which the latter will fund 49% of the equity requirement for the Mekhali transmission and MP solar assets, with an option to acquire DBL’s remaining 51% stake post commissioning. The transaction is expected to unlock ~INR 19bn for DBL against its equity investment of ~INR 8.5bn over the next 2–3 years. However, the pace of balance-sheet deleveraging (1HFY27 net debt: INR 21bn) remains contingent on timely funding arrangements for the remaining asset, which requires an additional ~INR 13bn. While management reiterated its FY27 revenue growth guidance of 30–40%, the modest 5.5% growth in H1FY27 implies a steep >50% growth requirement in H2FY27, making execution a key monitorable. We retain our ACCUMULATE rating with a TP of INR 488, with Q3FY27 revenue performance and the pace of debt reduction emerging as key near-term checkpoints.