Summary
Ashoka Buildcon Limited - Q3 FY26 Earnings Call Summary Monday, February 02, 2026 4:00 PM
Event Participants
Executives 2 Mr. Paresh Mehta (CFO), Mr. Satish Parakh (MD)
Analysts 5 Aditya Sahu (HDFC Securities), Amit Kumar (Determined Investments), Amit Vora (Homoeopathic Clinic), Bhavin Modi (Anand Rathi), Vaibhav Shah (JM Financial)
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Total Income (Standalone) | ₹1,492 crores | -18% YoY; Impacted by lower bidding activity and execution delays in specific projects. |
| EBITDA (Standalone) | ₹157 crores | -16% YoY; Margins improved +30 bps to 10.6% due to better project mix. |
| PAT (Standalone) | ₹102 crores | +68% YoY; Aided by deferred tax reversals and exceptional items. |
| Consolidated Debt | ₹2,722 crores | Reduced from ₹4,910 crores in Sep-25 following the monetization of 5 BOT assets. |
| Standalone Debt | ₹1,046 crores | Includes ₹667 crores working capital, ₹300 crores NCDs, and ₹79 crores equipment loans. |
| Order Book | ₹16,235 crores | Includes post-quarter wins; Road & Railways comprise 65%, Power T&D 32%. |
| Order Inflow (YTD) | ₹5,200 crores | Reflects subdued awarding by central agencies; targeting ₹3,000+ crores more in Q4. |
Geographic & Segment Commentary
- Roads & Railways: This segment constitutes 65% of the order book (₹10,292 crores). Management noted that bridge projects in Maharashtra (Kundalika, Jaigad) are facing land acquisition delays but expect execution to accelerate by Q1 FY27.
- Power T&D: This segment contributes 32.1% (₹5,108 crores) of the order book. The vertical remains a key diversification pillar with steady payment cycles supported by central government funding.
- International (Saudi Arabia): Ashoka established an office in Saudi Arabia targeting road, power, and building infrastructure. While no orders have been bagged yet, management expects potential inflows within 4-5 weeks and has impaired ₹37 crores in establishment costs as a conservative measure.
Company-Specific & Strategic Commentary
- Asset Monetization: Completed the sale of 5 BOT assets to Maple Infrastructure Trust for ₹1,814 crores. This move is part of a “developer-to-monetizer” strategy, flipping assets at 10-12% discounting to reinvest in EPC projects with 15-18% IRR.
- Simplification of Structure: Acquired 100% control of Ashoka Concessions Limited (ACL) by buying out Macquarie SBI Infrastructure Fund’s securities for ₹667 crores. ACL is now a 100% subsidiary, streamlining the corporate structure.
- Municipal Infrastructure: Secured major urban infrastructure projects from BMC (Mithi River development and flyovers) totaling ~₹3,300 crores through JVs, diversifying away from pure NHAI highway projects.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Revenue Growth | +15% in FY27 | Driven by the commencement of delayed projects (Bowaichandi) and new BMC orders. |
| EBITDA Margin | 10.0% - 11.0% | Management expects margins to stabilize as fixed overhead coverage improves with higher turnover. |
| Order Inflow | ₹11,000 - ₹12,000 crores (FY27) | Based on the pipeline for road, power, and new infrastructure sectors. |
| Debt Reduction | ₹200 - ₹300 crores by April 2026 | Planned monetization of 6 HAM assets and repayment of NCDs will further deleverage the balance sheet. |
Risks & Constraints
| Risk | Context |
|---|---|
| Land Acquisition | Execution at projects like Bowaichandi (West Bengal) and various Maharashtra bridge projects is delayed by 1-2 quarters due to slow land handover. |
| Regulatory (NHAI) | A disciplinary committee meeting is ongoing regarding a potential NHAI ban; however, a court stay currently allows the company to continue bidding. |
| Subdued Awarding | NHAI construction levels are at their lowest since 2017-18, which led to an 18-20% revenue de-growth for Ashoka in the current 9-month period. |
Q&A Highlights
Asset Monetization & Cash Usage
- Question: Why sell operational assets earning 15-16% IRR to sit on cash? (Amit Kumar)
- Answer: There is an arbitrage opportunity; financial investors buy these at 10-12% discounting. The cash is better utilized to fund new EPC projects and reduce the high debt burden from the balance sheet (Paresh Mehta).
NHAI Bidding Status
- Question: What is the status of the NHAI disciplinary matter? (Bhavin Modi)
- Answer: The matter is stayed in court, and the company is actively bidding. A committee is conducting meetings, but there is no current impact on business (Satish Parakh).
Project Timelines
- Question: When will the Bowaichandi project start? (Bhavin Modi)
- Answer: Financial closure is done; Appointed Date is expected in February 2026 once West Bengal land acquisition progresses (Satish Parakh).
One-off Expenses
- Question: Why was there a high “Other Expenditure” this quarter? (Vaibhav Shah)
- Answer: It included a ₹25 crore ECL (Expected Credit Loss) provision due to slight payment delays and the ₹37 crore impairment for Saudi operations (Paresh Mehta).
Key Takeaway
Ashoka Buildcon reported a transitionary Q3 FY26, with standalone revenue declining 18% YoY to ₹1,492 crores due to a broader slowdown in NHAI awarding and localized land acquisition hurdles in Maharashtra and West Bengal. Despite the top-line pressure, the company achieved a major strategic milestone by concluding the sale of 5 BOT assets, which helped slash consolidated debt by approximately ₹2,188 crores. The company has consolidated its ownership of Ashoka Concessions Limited to 100%, simplifying its structure for future monetization. Management is shifting focus toward municipal projects (BMC) and international markets to mitigate the highway sector’s volatility. Looking ahead, the company guides for a 15% revenue recovery in FY27 and aims to become nearly debt-free at the standalone level by April 2026. Investors should monitor the resolution of the NHAI disciplinary committee and the timely commencement of the ₹1,705 crore HAM project pipeline.
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