Earnings call transcript: Afcons Infrastructure Q1 2026 misses EPS, shares fall 3.1%

Afcons Infrastructure reported its first quarter results for fiscal 2027, revealing a shortfall in earnings per share (EPS) while revenue slightly surpassed expectations. The company's EPS of $1.95 fell short of the $2.40 forecast, marking an 18.75% decrease. Revenue amounted to $30.38 billion, $0.05 billion above the estimated $30.33 billion, representing a 0.16% increase.

Despite the revenue beat, the market responded negatively, with the stock falling 3.1% to $265.75, its closest to its 52-week low of $264.3. The quarter was characterized by slower execution, weaker revenue recognition, and temporary project delays, leading to a decline in total income to INR 2,727 crore from INR 3,419 crore the previous year.

Profitability, however, experienced a more significant drop, with EBITDA falling to INR 263 crore from INR 445 crore and profit after tax decreasing to INR 30 crore from INR 137 crore. Management highlighted that individual project margins remained robust but lower turnover exacerbated overhead costs. Adverse weather conditions affected marine projects, while slower land handovers, labor shortages, and regulatory delays further impacted the quarter.

The company anticipates weaker profit in the first half due to timing factors, though the size of the decline suggests investors may await a stronger second half before becoming more optimistic. Despite the earnings miss and weakened margins, Afcons remains a major player in the Construction & Engineering sector, with a robust pipeline of projects and strong balance sheet strength.