PSP Projects Ltd Q2 FY26 FY25 – From Patel’s Pride to Adani’s Apprentice: ₹2,485 Cr Sales, ₹26 Cr Profit, P/E 114 – Construction’s Most Suspicious Makeover
1. At a Glance – The Plot Thickens
Welcome to the curious case of PSP Projects Ltd, where the cement hasn’t dried but the ownership surely has. Once the pride of Gujarat’s construction hustle, now the company’s site board quietly reads: “Powered by Adani Infra.”
At a market cap of ₹2,975 crore and a P/E of 114, PSP is priced like it just discovered AI-driven bricks. The stock fell 7% in 3 months after Adani’s open-offer drama, yet analysts still stare at it like it’s the next L&T in diapers.
Latest quarter: Revenue ₹694 Cr (+20 % YoY), PAT ₹14.9 Cr (+33 % YoY), OPM 7 %, and a net margin that could be mistaken for pocket change. ROE 5.4 %, ROCE 8.7 %, Debt/Equity 0.30 – all acceptable, except for the valuation that screams “premium for proximity.”
If you ever wanted to watch a family construction business turn into a corporate thriller, grab your helmet — this is it.
2. Introduction – The Case of the Vanishing Margins
PSP Projects isn’t new to drama. Incorporated in 2008 by Prahalad S. Patel, the company grew from pouring concrete in Ahmedabad colleges to bagging hospital and housing projects across India.
But FY25-FY26 is when the plot twist arrived. Adani Infra entered with its cheque book — ₹685 Cr for 30 % stake, followed by a ₹642 offer for another 26 %. Suddenly the Patel clan sold most of their shares, and the company boardroom looked like a fresh cast in a daily soap.
Margins have been sliding faster than cement on wet plywood. Operating margin fell from 11 % in FY24 to ~7 % TTM, and PAT collapsed 72 %. Still, the company managed to pull a “Fastest Growing Construction Company (below ₹2,000 Cr turnover)” award — a perfect line for an auditor’s stand-up show.
The real question: is PSP’s future cemented or subcontracted to Adani’s empire?
3. Business Model – WTF Do They Even Do?
PSP Projects builds everything from industrial plants to government housing, institutions, hospitals, and residential complexes. Their in-house division covers the entire EPC circus — engineering & design, procurement, construction, MEP, and O&M.
They even own a pre-cast concrete facility in Gujarat — basically a Lego factory for grown-ups — to speed up project timelines.
As of Q3 FY24, 219 projects were completed, 49 under execution, and another ₹4,443 Cr order book waiting to keep site engineers awake.
Revenue mix by client type:
Government – 47 %
Institutional – 30 %
Residential – 10 %
Industrial – 9 %
Govt Residential – 4 %
Geographically, 87 % of work is in Gujarat, with UP and Rajasthan testing their out-of-state courage.
Think of PSP as Gujarat’s answer to NCC + NBCC + L&T Jr — but run by a family that suddenly got invited to the Adani family WhatsApp group.
4. Financials Overview – The Detective’s Ledger
Source table
Metric
Latest Qtr (Q2 FY26)
YoY Qtr (Q2 FY25)
Prev Qtr (Q1 FY26)
YoY %
QoQ %
Revenue (₹ Cr)
694
578
513
+20 %
+35 %
EBITDA (₹ Cr)
48
39
24
+23 %
+100 %
PAT (₹ Cr)
14.9
11.2
0.0
+33 %
n/m
EPS (₹)
3.76
2.81
0.05
+34 %
+7,420 %
Annualised EPS ≈ ₹15.0 → P/E ≈ 50×, yet Screener quotes 114×. Conclusion? Even Excel refuses to believe PSP’s profits exist consistently enough to divide.
The bounce-back from a near-zero Q1 profit to ₹15 Cr in Q2 suggests one of two things — either Adani accountants showed up, or the project billing gods woke up.
5. Valuation Discussion – Fair Value Range
Let’s investigate three angles.
(A) P/E Method If the industry trades ~22× earnings, and PSP earns ₹15 annualised EPS:
Lower Band = 22 × 15 = ₹330
Upper Band = 30 × 15 = ₹450
(B) EV/EBITDA Method FY25 EBITDA ≈ ₹180 Cr; EV ≈ ₹3,148 Cr. → EV/EBITDA ≈ 17.5×. Industry median ≈ 10×. If re-rated to 10–12×: Fair EV ≈ ₹1,800–2,200 Cr → Per Share ₹425–₹520.
