Ircon International in FY26: Stable EBITDA, weaker profit, and a 24,984 crore order book

Ircon International reported a softer FY26 on the topline, but managed to hold operating profitability at the consolidated level. For the year ended 31 March 2026, consolidated operating revenue came in at INR 9,071.1 crore, down 15.7% from INR 10,759.6 crore in FY25. Consolidated EBITDA was broadly flat at INR 1,279.3 crore versus INR 1,276.0 crore. Profit after tax declined to INR 591.9 crore from INR 727.8 crore.

The Q4 picture showed a sharp sequential recovery in activity. Consolidated operating revenue rose to INR 3,189 crore in Q4FY26 from INR 2,119 crore in Q3FY26. PAT almost doubled quarter-on-quarter to INR 191.5 crore from INR 99.9 crore. Year-on-year, Q4 revenue was lower versus Q4FY25, but EBITDA improved.

FY26 performance: margins held up, but PAT declined

The most notable headline in FY26 was the divergence between EBITDA and PAT. Consolidated EBITDA margin expanded to 13.5% in FY26 from 11.5% in FY25. However, finance cost increased to INR 350.1 crore in FY26 from INR 219.1 crore in FY25, and depreciation rose to INR 162.7 crore from INR 117.9 crore. This combination contributed to a decline in consolidated PBT and PAT.

Management’s commentary added useful texture. The Director (Finance) described FY26 as a challenging environment with sectoral headwinds and rising competitive intensity. Even so, the company maintained its order book at around 2 times annual revenue.

Standalone reality: EPC pressure and lower core margins

On a standalone basis, FY26 operating revenue was INR 8,478.9 crore versus INR 10,193.1 crore in FY25. Standalone EBITDA declined to INR 852.6 crore from INR 963.5 crore, and PAT declined to INR 618.5 crore from INR 737.6 crore.

The earnings call was candid about the standalone margin environment. Management attributed pressure to intensifying competition in EPC works and noted that some bids are being quoted below estimates. The company’s guidance for standalone core EBITDA margin was around 4.0% to 4.2%, indicating a structurally tighter profitability profile for pure EPC work.

This context is important when interpreting consolidated performance. Management highlighted that consolidated profitability is supported by returns from PPP projects in the group structure, which helps offset the lower-margin standalone execution business.

Order book: 24,984 crore, rail-heavy and domestic-led

Ircon’s reported order book stood at INR 24,984 crore as of 31 March 2026. The company disclosed a detailed mix across sector, geography, and award mode.

By sector, the order book is dominated by railways at 78% (INR 19,459 crore). Highways account for 16% (INR 3,919 crore) and others contribute 6% (INR 1,606 crore).

By geography, 92% of the order book is domestic (INR 22,956 crore), while international orders represent 8% (INR 2,028 crore).

By mode of award, competitive bidding accounts for 54% (INR 13,459 crore) and nomination accounts for 46% (INR 11,525 crore). Management clarified that nomination-led changes largely reflect scope and cost increases on cost-plus projects, and also stated that the Ministry of Railways is not assigning new work on a nomination basis.

Cash, investments, and funding: clarity on what belongs to Ircon

A recurring investor question in infrastructure companies is the nature of cash and debt. In the call, management stated that cash balance was around INR 4,200 crore, but clarified that the company’s own cash was about INR 950 crore, while the rest relates to client advances or project-specific funds.

On capital deployment, management described the cash use primarily through equity or quasi-equity investments into SPVs. The guided requirement for SPV funding was about INR 700 to 800 crore, with the bulk expected to be spent in FY26-27. They also indicated planned spend of INR 400 to 500 crore in FY26-27 in PPP projects, and routine capex and machinery purchase of INR 50 to 60 crore.

The call also addressed consolidated debt. Management explained that much of the consolidated borrowings sit in PPP SPVs, where typical project finance debt-to-equity structures can range from 70:30 to 80:20 and the debt is repaid over the concession period. They clarified that this leverage is not on the standalone balance sheet.

What management guided for FY27

Management did not provide an aggressive growth outlook for FY27. The stated expectation was to maintain revenue at levels similar to FY26, given that the order book is about two times annual revenue and several projects extend across two to three years. The company also reiterated the standalone core EBITDA margin expectation of around 4.0% to 4.2%, while indicating consolidated PAT margins could be maintained in the 6.1% to 6.3% range.

The call also provided a view on order inflows. Management said that in FY26 the company secured orders of around INR 5,000 crore, and submitted 107 bids for around INR 48,000 crore that were under evaluation at different stages. Management also gave historical context for bid conversion, stating that value won as a percentage of value bid was around 5.7% in FY24, around 6% in FY25, and around 10% in FY26.

Key takeaways

FY26 was a year where Ircon’s consolidated EBITDA held up despite a lower revenue base, but higher finance cost and depreciation translated into weaker profits. Order book disclosures were detailed and showed a railways-led, domestic-heavy portfolio of INR 24,984 crore with over half won through competitive bidding.

For FY27, management guidance pointed to stability rather than acceleration: revenue expected broadly similar to FY26, standalone margins expected to remain tight, and continued capital deployment into PPP SPVs. In a market that management described as intensely competitive, execution speed, working capital discipline, and conversion of the large bid pipeline into fresh orders will remain the key variables to track.