IL&FS Engineering & Construction Co. Ltd. (IL&FSENGG) AI Stock Analysis

• Market Cap: ₹3.06B
• Dividend Yield: N/A
• Average Volume (3M): 13.38K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.32
• Revenue Growth: -6.13%
• EPS Growth: 98.35%
• Country: IN
• Employees: 235
• Sector: Services
• Sector Strength: N/A
• Industry: Engineering & Construction
• EPS (TTM): 0.14
• Shares Outstanding: 131,121,080
• 10 Day Avg. Volume: 4,649
• 30 Day Avg. Volume: 13,385
• PEG Ratio: -2.04
• Price to Book (P/B): -0.09
• Price to Sales (P/S): 1.14
• P/FCF Ratio: -1.91
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 40 Underperform
• Price Target: ₹22.00 ▼(-18.34% Downside)
• Action: Reiterated Date: 12/02/25
• Date: Action: Reiterated 12/02/25

The overall stock score is primarily driven by the company's poor financial performance, characterized by declining revenues, negative profitability, and high financial leverage. The lack of technical indicators and poor valuation metrics further contribute to the low score. The absence of earnings call insights and corporate events limits the analysis.

Positive Factors

Contract-based EPC billing

The company's EPC model recognizes revenue as work is performed against milestones, creating a durable billing structure tied to contract progress. When contracts are secured and milestones met, this model provides predictable near-term cash flows and billing visibility across multi-month projects.

Historical ability to generate FCF

The firm has demonstrated it can produce substantial free cash flow in at least one prior year, showing execution and working-capital management can translate into cash generation. This historical precedent indicates operational recovery is feasible if execution, billing and receivable collection improve.

Signs of improving operating margins

Reported improvement in EBIT margin in 2025 signals early operational progress versus prior years. If sustained, margin recovery would help convert revenue into operating profits, improving resilience, funding capacity for projects, and the prospect of restoring positive net profitability over months.

Negative Factors

Negative equity / high leverage

Negative shareholders' equity and resultant negative debt-to-equity indicate severe capitalization stress. This structural balance-sheet weakness limits access to conventional financing, raises counterparty and supplier risk, and constrains long-term growth or bidding ability until recapitalized or restructured.

Sustained revenue decline

Multi-year top-line contraction weakens scale economics and undermines pricing and bargaining power on EPC contracts. Persistent revenue declines compress gross margins, reduce fixed-cost absorption, and erode strategic positioning vs. competitors, making recovery and margin normalization more difficult.

Negative operating and free cash flow recently

Recent negative operating and free cash flows indicate the business is not generating sufficient internal funds for operations or debt service. Structural shortfalls in cash conversion increase refinancing and liquidity risk, constrain capital expenditure and project execution, and raise chance of forced restructuring.

IL&FS Engineering & Construction Co. Ltd. Business Overview & Revenue Model

Company Description

IL&FS Engineering and Construction Company Limited engages in infrastructure development and construction, and project management businesses in India and internationally. It develops and constructs roads and bridges, railways, expressways, and highways; residential buildings, commercial buildings, industrial structures, and hospital buildings; irrigation canals and dams; and thermal and hydel power projects. The company also develops ports involving construction of berths, jetties, breakwaters, marine structures, and cargo handling facilities, as well as land for setting up port-based industries; and constructs terminal buildings, runways, aprons, parking bays, hangers, and other structures in the airport sector. In addition, it constructs rail and rail-based systems; oil and gas pipelines and storage tank terminals; water and water treatment plants; power generation, transmission, and distribution projects; and industrial construction projects. The company was formerly known as Maytas Infra Limited and changed its name to IL&FS Engineering and Construction Company Limited in January 2011. IL&FS Engineering and Construction Company Limited was incorporated in 1988 and is based in Hyderabad, India.

How the Company Makes Money

IL&FSENGG primarily makes money by winning infrastructure construction contracts and executing them, typically under EPC and similar project-delivery arrangements. Under these contracts, revenue is generally earned as work is performed (e.g., based on milestone/measurement certifications such as running account bills), with payments received from customers according to agreed billing schedules and contract terms. Key revenue streams therefore include: (1) EPC/project execution income from civil construction and infrastructure works; (2) variations/claims, escalation clauses, and change orders where contract terms allow additional compensation for scope changes, time extensions, or cost increases; and (3) ancillary receipts tied to project execution (e.g., mobilization advances, retention releases upon completion, and defect-liability-period releases), to the extent recognized as revenue under applicable accounting standards. The company’s earnings are influenced by its ability to secure new orders, execute projects within cost and time budgets, manage subcontractors and procurement effectively, and collect receivables on time. Specific disclosures on the company’s segment-wise revenue mix, named major customers, or significant partnerships are not available in the provided context and are therefore null.

IL&FS Engineering & Construction Co. Ltd. Financial Statement Overview

Summary

IL&FS Engineering & Construction Co. Ltd. faces significant financial challenges with declining revenues, negative profitability margins, and high financial leverage. The company has struggled with negative equity and cash flow difficulties, indicating a need for strategic restructuring or financial support. The current financial state suggests a high-risk profile, with urgent attention needed to address liquidity and profitability issues.

Income Statement

The income statement reveals declining revenue from 2020 to 2025, with a significant drop in 2023 followed by some recovery. The gross profit margin is low and has been decreasing, indicating challenges in maintaining profitability. Net profit margin is negative, reflecting losses over the years. Despite improvements in EBIT margin in 2025, it remains negative, highlighting ongoing operational challenges.

Balance Sheet

The balance sheet shows a concerning negative stockholders' equity, which has been deteriorating. The debt-to-equity ratio is negative due to negative equity, indicating high financial leverage and risk. The equity ratio is negative, reflecting insolvency concerns. Overall, the balance sheet suggests financial instability and high leverage.

Cash Flow

The cash flow statement shows negative operating and free cash flow in recent years, indicating operational challenges. Although there was a significant positive free cash flow in 2020, subsequent years have seen declines. The operating cash flow to net income ratio is unfavorable, reflecting inefficiencies. The company needs to improve cash generation to stabilize its financials.

Breakdown	TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2022	Mar 2021
Income Statement
Total Revenue	2.66B	3.21B	2.56B	1.71B	2.33B	3.33B
Gross Profit	319.80M	384.60M	633.90M	544.20M	353.70M	940.30M
EBITDA	85.30M	59.50M	-604.70M	-947.50M	-1.67B	-1.34B
Net Income	-17.10M	-48.80M	-774.50M	-1.24B	-3.86B	-2.85B
Balance Sheet
Total Assets	16.45B	17.07B	16.95B	18.26B	19.16B	24.39B
Cash, Cash Equivalents and Short-Term Investments	2.21B	3.18B	3.41B	3.48B	1.04B	669.70M
Total Debt	26.72B	26.72B	26.71B	26.71B	26.29B	26.69B
Total Liabilities	48.45B	48.96B	48.79B	49.33B	48.98B	50.34B
Stockholders Equity	-32.00B	-31.89B	-31.84B	-31.07B	-28.74B	-24.88B
Cash Flow
Free Cash Flow	-1.59B	-488.10M	-727.50M	77.50M	931.00M	305.50M
Operating Cash Flow	-1.59B	-488.10M	-727.50M	77.50M	975.40M	349.90M
Investing Cash Flow	1.25B	867.40M	-227.20M	547.60M	-139.30M	94.60M
Financing Cash Flow	-10.90M	-8.90M	-97.30M	-191.40M	-466.00M	-444.40M

IL&FS Engineering & Construction Co. Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	55 Neutral	$13.29B	17.42	10.03%	0.93%	7.13%	-12.93%
MBLINFRA	54 Neutral	₹3.31B	-12.79	―	―	12.96%	-132.20%
A2ZINFRA	48 Neutral	₹2.69B	-113.54	―	―	1.97%	-6.97%
IL&FSENGG	40 Underperform	₹3.06B	-213.66	―	―	-6.13%	98.35%
SUPREMEINF	39 Underperform	₹6.91B	-4.23	―	―	-31.16%	―
MADHUCON	38 Underperform	₹329.86M	-0.11	―	―	-52.19%	-3109.52%