Ircon International Ltd. was listed on the NSE on September 28, 2018. In the last five years, the stock has given a massive return of more than 280% to its investors. Will IRCON continue to provide such great returns in the future as well? Let’s explore Ircon International’s growth potential and IRCON share price target from 2025 to 2050 in this article.
About Ircon International Ltd
Ircon International Limited is an Indian government-owned company that specializes in railway and infrastructure projects. It was established in 1976 and operates under the Ministry of Railways. IRCON works on building and upgrading railways, highways, bridges, and other infrastructure in India and other countries.
IRCON Business Model
- Railway Projects: IRCON earns money by constructing railway tracks, bridges, tunnels, and stations in India and other countries. It gets contracts from the government and private companies.
- Highway and Road Construction: IRCON builds highways, expressways, and other roads.
- Electrification Work: IRCON makes money by installing and maintaining railway electrification systems, which help trains run on electricity instead of diesel.
- International Projects: IRCON works on railway and infrastructure projects in other countries, earning money by providing engineering and construction services.
- Real Estate Development: IRCON earns money by developing commercial and residential buildings, mainly on land owned by Indian Railways.
- Consultancy Services: IRCON provides expert advice and project management services to other companies and governments, earning revenue from consultancy fees.
IRCON Fundamental Analysis
| Stock Name | Ircon International Ltd. |
|---|---|
| NSE Symbol | IRCON |
| Market Cap | ₹ 13,572 Cr. |
| 52W High | ₹ 352 |
| 52W Low | ₹ 134 |
| Stock P/E | 17.7 |
| Book Value | ₹ 65.7 |
| Dividend Yield | 2.13 % |
| ROCE | 18.2 % |
| ROE | 16.4 |
| Face Value | ₹ 2.00 |
| Shareholders | March 2023 | March 2024 | Dec 2024 |
|---|---|---|---|
| Promoters | 73.18% | 65.17% | 65.17% |
| FIIs | 3.99% | 4.58% | 4.09% |
| DIIs | 1.87% | 1.31% | 1.44% |
| Government | 0.26% | 0.26% | 0.28% |
| Public | 20.71% | 28.66% | 29.03% |
| No. of Shareholders | 2,97,623 | 9,31,492 | 12,15,386 |
Key Factors Driving IRCON’s Future Growth
- Government Infrastructure Projects: IRCON benefits from large government projects such as railways, highways, and bridges, which ensures a consistent flow of work.
- Strong Order Book: IRCON has a strong pipeline of projects, ensuring long-term revenue visibility and stability.
- Focus on High-Speed Rail: IRCON is involved in high-speed rail projects such as bullet trains, which will help drive its growth in the coming years.
- Government Support: As a government-backed company, IRCON receives financial and operational support, which aids in the sale of large projects.
- Growing Development: As cities grow, so does the demand for better railway and road infrastructure, which benefits IRCON.
- Technological Advancements: IRCON employs advanced construction techniques and technology to complete projects faster and at a lower cost.
- Public-Private Partnerships (PPPs): IRCON collaborates with private players to fund and execute infrastructure projects, allowing it to expand its operations.
- Strong Financials: IRCON has a strong financial position, allowing it to take on large projects without financial constraints.
- Rising Demand for Transport: As India’s population grows, so will the demand for better rail and road networks, opening up new opportunities for IRCON.
- Metro Rail Expansion: IRCON is working on metro projects in several cities, which will be a major driver of its future growth.
- Upgrading the Existing Rail Network: IRCON is working on electrification, track doubling, and railway station progress to ensure continuous project inflow.
Pros of IRCON
- Strong Sales Growth: Ircon has achieved a strong sales growth of 32% CAGR over the last three years.
- Strong Profit Growth: Ircon has achieved a strong profit growth of 33% CAGR over the last three years.
- Low PE Ratio Compared to Peers: Ircon has a PE ratio of 17.7, which is lower than the industry average of 18.5, making it relatively undervalued and potentially a good investment opportunity.
- Increase in FIIs Holding: Foreign Institutional Investors (FIIs) have increased their holding to 4.09% in December 2024 from 3.94% in September 2024, which indicates growing confidence in the Ircon future potential by the FIIs.
Cons of IRCON
- Decrease in DIIs Holding: Domestic Institutional Investors (DIIs) have reduced their holding to 1.44% in December 2024 from 1.63% in September 2024, indicating a decline in DIIs confidence in the company’s future growth prospects.
| Years | Target Price |
|---|---|
| IRCON Share Price Target 2025 | ₹180 to ₹230 |
| IRCON Share Price Target 2026 | ₹170 to ₹300 |
| IRCON Share Price Target 2027 | ₹210 to ₹390 |
| IRCON Share Price Target 2028 | ₹250 to ₹510 |
| IRCON Share Price Target 2029 | ₹300 to ₹660 |
| IRCON Share Price Target 2030 | ₹360 to ₹860 |
| IRCON Share Price Target 2035 | ₹720 to ₹2580 |
| IRCON Share Price Target 2040 | ₹1450 to ₹7800 |
| IRCON Share Price Target 2050 | ₹5800 to ₹46300 |
Conclusion
IRCON has shown strong growth over the past five years, delivering impressive returns to investors. With government-backed projects, railway expansion, international contracts, and a strong financial position, IRCON is well-positioned for future growth. The company benefits from a strong order book, technological advancements, and increasing demand for transportation infrastructure. For more updates, you can visit IRCON official website.
Disclaimer
This article is for educational purposes only. It is not a stock recommendation and should not be treated as such. Please ask your financial advisor before making any investment decision.
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