PNC Infratech (PNCL IN) – Q3FY26 Result Update – Near-term pain, medium-term recovery intact – BUY
Published on 10 Feb 2026
PNC Infratech (PNCL) reported weak execution in Q3FY26, with standalone revenue declining 22% YoY in 9MFY26, reflecting execution delays, although profitability remained resilient (EBITDA margin: 12.8%, PAT margin: ~7%). Execution is expected to improve from Q4FY26E (revenue growth of 20%+ YoY), supporting a stronger exit, despite FY26 revenue likely declining ~10% YoY to ~Rs50bn. Looking ahead, based on order readiness, PNCL is targeting ~25% YoY revenue growth in FY27E, driven by execution of its existing order book. The unexecuted order book (excluding slow-moving projects) of Rs158bn (3.4x TTM revenue) provides medium-term visibility, notwithstanding near-term awarding delays, with ~70% exposure to roads and ~15% each to water and mining. PNCL continues to maintain a strong net-cash balance sheet (Rs15bn+), alongside cumulative equity investments of ~Rs11bn in HAM projects. The bid pipeline remains robust, with outcomes awaited for road, rail and airport EPC bids aggregating to ~Rs287bn. We remain constructive on an execution-led recovery in FY27E, supported by balance sheet strength and valuation comfort (10x FY28E EPS, ~1x BV). We and BUY rating with an SOTP-based TP of Rs291.
