This article first appeared on GuruFocus .
Release Date: November 13, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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IRCON International Ltd ( NSE:IRCON ) reported a total revenue of INR 2,112 crore for Q2 FY26.
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The company achieved a profit after tax (PAT) of INR 137 crore in Q2 FY26.
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The order book stood at INR 23,865 crore as of September 30, 2025, with 91% of the projects being domestic.
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The company has realized foreign exchange earnings of approximately INR 20 crore from its Bangladesh project due to favorable exchange rate differences.
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IRCON International Ltd ( NSE:IRCON ) has secured more than INR 4,000 crore in orders in the first half of the financial year, with expectations of similar inflows in the second half.
Negative Points
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Margins have been impacted due to losses in joint ventures and subsidiaries under construction.
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The company has experienced a reduction in margins by 0.5% to 1% due to new projects being won at lower margins.
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Two projects have incurred losses, contributing to lower EBITDA and PAT margins.
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The CERL joint venture is currently undergoing losses and is expected to break even only in 18 to 20 months.
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The competitive market environment has led to projects being quoted below estimates, impacting margins.
Q & A Highlights
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Q: Can you explain the reason for the decline in margins this quarter and the outlook for FY26 and FY27? A: Margins have been impacted due to losses in our joint venture companies, particularly CERL, and adverse impacts in subsidiaries under construction. We anticipated a 0.5% to 1% reduction in margins due to new projects with lower margins and some project losses. However, we expect PAT margins to stabilize around 6% to 7% going forward. - Director of Finance
Q: What is the outlook for order inflow and revenue for the full year and next year? A: We have secured over INR 4,000 crore in orders in the first half of the financial year and expect a similar range in the second half. Despite a slow start, we anticipate operating revenue of INR 10,000 to 11,000 crore for the full year and maintain a similar level for the next year. - Director of Finance
Q: How are international projects performing in terms of margins, and what is the impact of foreign exchange? A: International projects generally have higher margins than domestic ones. This year, we benefited from foreign exchange gains, particularly from our Bangladesh project, contributing approximately INR 20 crore to our earnings. - Director of Finance
Q: Can you provide insights into the performance and future of joint ventures? A: Our highway project, Ircon Soma Tollway Limited, continues to be profitable, but its concession period ends next year. The CERL coal connectivity project is currently incurring losses but is expected to break even in 18 to 20 months. The IRSDC joint venture is under closure, and we expect to recover our investment by early next year. - Director of Finance
Q: What is the current split between domestic and international projects in terms of turnover and order book? A: The turnover split is approximately 96% domestic and 4% international. The order book consists of about 10% international projects. - Director of Finance
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
