GMR Infra Future Share Price Projections
GMR Infra, a major infrastructure company in India, has been growing steadily over the years. The company operates in various sectors, including airports, energy, highways, and urban infrastructure development. GMR Infra has been an integral part of India’s growth story, and investors are keen to know the future share price projections for the company.
In this article, we will analyze GMR Infra’s financial performance, industry trends, and future growth potential to forecast the share price for the next 5-10 years.
Financial Performance Analysis
GMR Infra has been delivering a strong financial performance over the years. The company’s revenue for the fiscal year 2020 was INR 9,662 crore ($1.3 billion), a 17% increase from the previous year. The company’s EBITDA margin has improved from 9% in FY19 to 15% in FY20.
GMR Infra’s net profit for the fiscal year 2020 was INR 464 crore ($63 million), a significant improvement from the net loss of INR 561 crore ($76 million) in the previous year. The company has managed to reduce its debt significantly, from INR 20,502 crore ($2.8 billion) in FY19 to INR 14,858 crore ($2 billion) in FY20.
GMR Infra’s airport business has been the major contributor to its revenue growth. The company operates airports in Delhi, Hyderabad, and Cebu (Philippines). The Delhi and Hyderabad airports have witnessed strong passenger traffic growth over the years.
The energy business, which includes power and non-power assets, has been struggling with low capacity utilization and lower tariffs. The company is looking to improve the business by selling non-core assets and reducing debt.
The highways and urban infrastructure businesses have been performing steadily, with a focus on EPC projects and asset monetization.
Industry and Growth Potential Analysis
The infrastructure sector is a significant contributor to India’s economic growth. The government has been investing heavily in infrastructure development, and the private sector has also been actively participating in the sector.
The airport business is expected to grow at a CAGR of 10-12% over the next five years, driven by increasing passenger traffic and new airport development. GMR Infra is well-positioned to benefit from this growth, with its presence in Delhi and Hyderabad airports.
The energy business is expected to rebound in the next few years, with a focus on renewable energy and asset monetization. GMR Infra has a 735 MW operating capacity in the energy sector and is looking to expand its renewable energy portfolio.
The highways and urban infrastructure businesses will continue to focus on EPC projects and asset monetization, with the government’s focus on infrastructure development.
Future Share Price Projections
Based on the financial performance analysis and industry and growth potential analysis, we can forecast GMR Infra’s future share price.
Assuming a CAGR of 12% over the next five years, GMR Infra’s revenue is expected to reach INR 16,936 crore ($2.3 billion) by FY25. Assuming an EBITDA margin of 15%, the company’s EBITDA is expected to be INR 2,540 crore ($347 million) by FY25. Assuming a net profit margin of 3%, the company’s net profit is expected to be INR 508 crore ($69 million) by FY25.
If we assign a P/E ratio of 10 to GMR Infra based on its growth potential and financial performance, the company’s market capitalization is expected to reach INR 25,400 crores ($3.5 billion) by FY25. With 1,359 crore ($186 million) outstanding shares, the share price is expected to be INR 187 ($2.5) by FY25.
Thus, based on the above analysis and assumptions, we can project that GMR Infra’s share price is expected to grow at a CAGR of around 14% over the next five years, from the current price of INR 23.3 ($0.3) to INR 85 ($1.2) by FY25.
GMR Infra has been delivering a strong financial performance, with a focus on airport development, asset monetization, and debt reduction. The infrastructure sector in India is expected to grow significantly in the next few years, and GMR Infra is well-positioned to benefit from this growth.
Based on our analysis, GMR Infra’s future share price is expected to grow at a CAGR of around 14% over the next five years, from the current price of INR 23.3 ($0.3) to INR 85 ($1.2) by FY25. Investors should keep a close watch on the company’s financial performance and growth potential to reap the benefits of this growth story.