At a Glance
Sonu Infratech, the SME construction maverick, just reported Q1 FY26 Revenue ₹36.5 Cr (YoY growth >100%), and PAT ₹2.64 Cr (+99% YoY). Despite high debtor days (192!) and promoter stake sliding to 54%, the company’s ROE at 23.3% screams efficiency. Stock at ₹123 trades at P/E of 11x—a bargain or a value trap? That’s the billion-rupee question.
Introduction
Incorporated in 2017, Sonu Infratech is the construction brat of Gujarat, scaling up from scaffolding gigs to full-fledged civil engineering contracts. While L&T builds metros, Sonu is quietly bagging mid-sized projects with juicy margins. Its sales have grown at a 41% CAGR over three years—try finding that in most mid-cap infra players.
Business Model (WTF Do They Even Do?)
- Civil Construction: Roads, bridges, industrial sheds.
- Mechanical Scaffolding & Maintenance: Core bread-and-butter.
- Repairs & Plant Maintenance: Steady annuity-like work.
- Clientele: Industrial plants, local governments, private projects.
Unlike peers, Sonu thrives on niche contracts where bigger players don’t bother bidding.
Financials Overview
Q1 FY26
- Revenue: ₹36.5 Cr (vs ₹17.7 Cr LY)
- EBITDA: ₹6.12 Cr
- PAT: ₹2.64 Cr (EPS ₹2.55)
- OPM: 16.7% (healthy)
FY25
- Revenue: ₹149 Cr
- PAT: ₹11 Cr
- OPM: 14%
- ROE: 23%
Comment: Growth is robust, margins consistent, and profits doubling YoY.
Valuation
- CMP: ₹123
- P/E: 11x (cheap vs sector average 20–30x)
- Book Value: ₹57.4
- Fair Value Range: ₹135–₹150 (based on earnings trajectory & low P/E)
What’s Cooking – News, Triggers, Drama
- Q1 FY26 growth: Sales almost doubled; PAT up 99%.
- Promoter stake drop: From 65% to 54%—why so serious?
- Debt levels
