1. At a Glance
₹343 crore market cap. ₹25.9 stock price. ₹2,672 crore debt. Net worth so negative that even Excel gives up and shows Book Value: –₹244. That’s not a typo; that’s emotional damage.
IL&FS Engineering & Construction Co Ltd (IL&FS Engg) is that one infra stock which refuses to die, refuses to revive, and keeps trading like a Bollywood villain who keeps re-entering the movie after being shot. The company reported Q3 FY26 revenue of ₹62.36 crore with PAT of ₹1.78 crore, which looks decent until you zoom out and realise the TTM PAT is –₹27 crore, operating margins are –31%, interest coverage is –5.8, and loan defaults stand at ~₹2,727 crore.
The stock is down 37% YoY, yet up 45% over 5 years, proving once again that Indian markets respect hope more than balance sheets.
Question for you before we go deeper:
👉 Is this a turnaround story… or just a very active zombie company?
2. Introduction – Welcome to the IL&FS Multiverse
IL&FS Engineering was once a serious EPC player. Roads, metros, irrigation, ports, power, oil & gas—you name it, they’ve built it. Mumbai–Pune Expressway? Done. Bangalore NICE Road? Done. Metro projects? Absolutely.
Then came the IL&FS Group collapse, and this company got dragged into the financial equivalent of a CBI documentary series.
Since then:
- Continuous losses
- Net worth completely eroded
- Massive loan defaults
- NCLT intervention
- Board reconstitution
- Resolution process still cooking… slowly… very slowly
And yet, projects still exist. Revenue still comes in. Occasionally, the company even posts a quarterly profit, just to confuse analysts and give traders false hope.
This is not a growth story.
This is not even a value story.
This is a courtroom drama disguised as an EPC company.
So why are we even analysing it?
Because sometimes, distress itself becomes the investment thesis.
3. Business Model – WTF Do They Even Do?
In simple terms:
IL&FS Engg is an EPC contractor—Engineering, Procurement, Construction.
They design it.
They build it.
They bill it.
They don’t get paid on time.
Their project portfolio is absurdly wide:
- Roads & highways
- Metro & rail projects
- Ports
- Irrigation canals & dams
- Power transmission
- Oil & gas pipelines
- Residential & commercial buildings
They don’t lack technical capability.
They lack financial oxygen.
Right now, they cannot bid for new projects independently due to:
- Defaults
- Poor credit ratings
- Resolution restrictions
So the company survives by:
- Completing old projects
- Sub-contracting (like Surat Metro)
- Exploring JVs with financially stable partners
Think of it as a brilliant civil engineer who can build a flyover—but whose credit card is permanently blocked.
4. Financials Overview
Quarterly Performance (Q3 FY26 – Consolidated, ₹ Crore)
| Metric | Latest Qtr (Dec’25) | YoY Qtr (Dec’24) | Prev Qtr (Sep’25) | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue | 62.36 | 67.91 | 54.53 | -8.17% | 14.4% |
| EBITDA | -3.14 | -4.28 | -8.83 | Improved | Improved |
| PAT | 1.78 | 1.49 | -1.26 | 136.9% | Turned + |
| EPS (₹) | 0.14 | 0.11 | -0.10 | NA | NA |
Yes, PAT is positive.
No, this does not mean revival.
This profit is driven by other income and accounting reversals, not operational muscle. Core operations are still bleeding.
Now ask yourself:
👉 Can a company with negative operating margins sustainably survive just on “other income”?
5. Valuation Discussion – Fair Value Range (Educational Only)
Method 1: P/E (Almost Useless
