💰 Financial Performance

Revenue Growth by Segment

Consolidated revenue for Q2 FY26 stood at INR 472 Cr, representing a 10.4% YoY decline from INR 527 Cr in Q2 FY25. Standalone revenue for Q2 FY26 was INR 445 Cr, down 11.5% from INR 503 Cr YoY. Segment-specific growth percentages for Water, Industrial, and Urban solutions were not disclosed, though management noted a temporary decline as large Hybrid Annuity Model (HAM) projects reached completion while new projects remained in the engineering phase.

Geographic Revenue Split

Not disclosed in available documents; however, the company maintains a significant presence in Hyderabad (HMWSSB projects) and Visakhapatnam (VPCL projects).

Profitability Margins

Standalone PAT for Q2 FY26 was INR 68 Cr, a 29.9% decrease from INR 97 Cr in Q2 FY25. Consolidated PAT for Q2 FY26 was INR 76 Cr, down 8.4% from INR 83 Cr YoY. The decline is attributed to the transition between project cycles and lower execution volumes in the current quarter.

EBITDA Margin

Standalone EBITDA margin excluding other income dropped to 17.54% in Q2 FY26 from 24.4% in Q2 FY25. Including other income, the company targets a sustainable consolidated EBITDA margin of 21% to 22%. The margin compression in Q2 FY26 was driven by the completion of high-margin HAM projects and the 'pushing' of planned execution into Q3 and Q4 FY26.

Capital Expenditure

Not disclosed in available documents; however, the company is focusing on asset monetization, specifically the sale of Visakha Pharmacity (VPCL), with the Sale and Purchase Agreement (SPA) expected to conclude by March 2026 to improve liquidity.

Credit Rating & Borrowing

Assigned a long-term rating of IVR BBB-/Stable and a short-term rating of IVR A3 as of December 20, 2024. The company formally exited the restructuring framework in July 2025, with accounts reclassified as 'Standard' by lenders. Consolidated debt stands at INR 163 Cr, while standalone term debt is Nil.

⚙️ Operational Drivers

Raw Materials

Specific raw materials include steel, cement, bitumen, and aggregates. The exact percentage of total cost for each material is not disclosed in available documents.

Capacity Expansion

The company operates as an EPC and O&M provider rather than a manufacturer. Current order book stands at INR 8,700 Cr to INR 9,200 Cr, with a target to expand the backlog to INR 12,000 Cr by the end of FY26.

Raw Material Costs

Not disclosed as a specific percentage of revenue; however, management identified fluctuations in input costs as a key risk factor that could lead to cost overruns and margin pressure.

Manufacturing Efficiency

Not applicable as an infrastructure company; however, the company utilizes ~65% of its fund-based limits, providing a cushion for working capital requirements for new orders.

📈 Strategic Growth

Expected Growth Rate

30%

Growth Strategy

The company aims to reach an INR 12,000 Cr order backlog by the end of FY26, up from the current INR 9,200 Cr. This will be achieved through aggressive bidding in core sectors like Water, Waste Water, and Industrial Solutions. Revenue for FY26 is targeted at INR 2,200 Cr (excluding other income), supported by the momentum of new large projects currently in the engineering stage which are expected to scale in Q3 and Q4 FY26.

Products & Services

EPC services for water treatment plants, sewage treatment plants (e.g., Nagole STP), roads, bridges, industrial parks, and residential/commercial buildings; Operation & Maintenance (O&M) services for infrastructure assets.

Brand Portfolio

Ramky Infrastructure Limited, Ramky Group, Ramky One Odyssey (Residential project).

New Products/Services

Expansion into Hybrid Annuity Model (HAM) projects in the water sector, such as the INR 2,085 Cr HMWSSB project, which offers higher margins than traditional EPC work.

Market Expansion

Targeting increased participation in industrial solutions and urban infrastructure projects across India, leveraging its 30-year track record.

Market Share & Ranking

One of the leading ISO-certified EPC companies in India; specific market share percentage not disclosed.

Strategic Alliances

Collaborations with government bodies like Hyderabad Metropolitan Water Supply and Sewage Board (HMWSSB) and group companies like Ramky Estates & Farms Private Limited (REFL).

🌍 External Factors

Industry Trends

The infrastructure sector is seeing a shift toward HAM and O&M models to ensure sustainable margins. The industry is currently growing due to government focus, but remains highly competitive with fragmented players, necessitating a shift toward high-margin specialized projects.

Competitive Landscape

Faces intense competition from both large organized players and smaller unorganized firms in the civil construction space.

Competitive Moat

The company's moat is built on 3 decades of execution experience and its status as the flagship of the Ramky Group. This provides a competitive advantage in qualifying for large-scale, complex government tenders that require high technical eligibility.

Macro Economic Sensitivity

Highly sensitive to government infrastructure spending and interest rate movements. A rise in interest rates would increase the cost of servicing the INR 163 Cr consolidated debt and impact the viability of HAM projects.

Consumer Behavior

Not applicable; demand is driven by government infrastructure policy and industrial expansion rather than individual consumer trends.

Geopolitical Risks

Geopolitical dynamics are cited as a factor that could influence macroeconomic conditions and input cost stability.

⚖️ Regulatory & Governance

Industry Regulations

Operations are subject to regulatory and policy developments in the infrastructure sector, including environmental norms for STPs and industrial parks.

Legal Contingencies

The company faces sensitivities regarding the positive resolution of disputed Bank Guarantees (BGs), which is a key factor for credit rating upgrades. Specific case values in INR were not disclosed.

⚠️ Risk Analysis

Key Uncertainties

Execution risks including delays and cost overruns could impact margins by 5-10%. The transition between old projects ending and new projects starting creates quarterly revenue volatility, as seen in the Q2 FY26 decline.

Geographic Concentration Risk

Significant concentration in Southern India, particularly Telangana and Andhra Pradesh, through group and state government projects.

Third Party Dependencies

High dependency on government and group entities for 90% of the order book, making the company vulnerable to state budget reallocations.

Technology Obsolescence Risk

Low risk in civil construction, but the company is adopting modern design and engineering practices to maintain its ISO-certified EPC status.

Credit & Counterparty Risk

Counterparty risk is considered mitigated due to the involvement of established entities like HMWSSB and group companies, though receivables quality remains a monitored metric.