H.G. Infra Engineering (HGINFRA IN) – Q3FY26 Result Update – Growth hinges on order conversion & deleveraging – Accumulate
Published on 14 Feb 2026
HG Infra reported a muted Q3FY26 performance with revenue moderation (-4% YoY) due to execution delays and slower appointed dates, though EBITDA margins remained resilient at mid-teens (~15.5%). Elevated working capital and interim funding to solar SPVs led to higher standalone debt (~Rs15.5 bn, 0.5x DER), which is expected to ease post commissioning and debt drawdown (~Rs4.25 bn pending). Management has guided for ~Rs70 bn revenue in FY27 (10–12% YoY growth) with margins sustaining at ~14–15%, supported by targeted order inflows of Rs100–120 bn in FY27E. The order book stands at ~Rs136.2 bn (2.2x TTM revenue) with increasing diversification away from road (~65% of order book) into rail (20% of order book) and renewables (~15% of order book); however, ~38% of orders remain slow moving due to appointed date and land-related delays. Stock valuation on FY28E at 8x PER and 1x BV is attractive, we have an Accumulate rating with SOTP base target price of Rs724/sh, while execution and order conversion remain key monitorable.
