As the Indian road infrastructure sector continues its growth trajectory, investors and analysts alike scrutinise companies not just in isolation but in relation to their industry peers. Highway Infrastructure (HIL), poised for its IPO, provides a case study in how a focused business model stacks up against more diversified and established rivals like Udayshivakumar Infra, IRB Infrastructure Developers, and H.G. Infra Engineering. Below is a comprehensive and analytical breakdown based on the most recent financial data and key operating metrics.
Highway Infrastructure IPO Snapshot
| Highway Infrastructure IPO Dates | 5 – 7 August 2025 |
| Highway Infrastructure IPO Price | INR 65 – 70 per share |
| Fresh issue | INR 97.52 crore |
| Offer For Sale | 46,40,000 shares (INR 30.16 – 32.48 crore) |
| Total IPO size | INR 127.68 – 130 crore |
| Minimum bid (lot size) | 211 shares (INR 14,770) |
Highway Infrastructure Peer Group Selection: Context and Limitations
It’s crucial to note that while these companies operate in overlapping sectors—toll collection, EPC projects, and allied infrastructure services—their business models, scale, and operational footprints differ markedly. For instance, while IRB Infrastructure commands a national presence and dominates BOT (Build-Operate-Transfer) concessions, H.G. Infra focuses on EPC and HAM projects with broad project diversification, and Udayshivakumar Infra operates at a smaller scale with negative recent returns. These disparities must be factored in when interpreting financial ratios and operational metrics.
Financial Performance Snapshot (FY 2025)
| Metric | Highway Infra | Udayshivakumar Infra | IRB Infra Dev. | H.G. Infra Eng. |
|---|---|---|---|---|
| Revenue | 495.72 | 289.13 | 7,613.47 | 5,056.18 |
| EBITDA | 313.2 | 27.3 | 3,468.74 | 1,059.72 |
| EBITDA Margin (%) | 6.32 | 0.95 | 45.56 | 20.96 |
| PAT | 22.40 | (7.21) | 6,480.68 | 505.40 |
| PAT Margin (%) | 4.44 | (2.44) | 80.69* | 9.97 |
| Debt/Equity Ratio | 0.61 | 0.36 | 1.04 | 1.41 |
| ROCE (%) | 16.56 | -0.92 | 7.82 | 16.8 |
*High PAT margin for IRB likely reflects extraordinary items or one-off gains.
Key Valuation and Trading Metrics
| Ratio | Highway Infra | Udayshivakumar Infra | IRB Infra Dev. | H.G. Infra Eng. |
|---|---|---|---|---|
| EPS (INR) | 3.13 | (1.18) | 1.12 | 75.04 |
| P/E Ratio | 22.4 | N.A. | 44.38 | 14.00 |
| Price to Book | 3.43 | 1.19 | 1.35 | 2.27 |
| Price to Sales | 0.99 | 0.70 | 3.52 | 1.32 |
| Current Ratio | 1.91 | 1.86 | 1.58 | 1.58 |
| ROCE (%) | 16.56 | (0.92) | 7.82 | 16.8 |
| Debt to Equity | 0.61 | 0.36 | 1.04 | 1.41 |
*HIL’s closing price-to-earnings and other trading ratios will crystallise post-IPO listing.
Growth Trajectory (CAGR FY 2023–2025)
| Metric | Highway Infra | Udayshivakumar Infra | IRB Infra Dev. | H.G. Infra Eng. |
|---|---|---|---|---|
| Revenue CAGR (%) | 4.36 | 0.39 | 9.05 | 4.59 |
| EBITDA CAGR (%) | 6.36 | (70.39) | 5.41 | 8.72 |
Operational Scale
| Metric | Highway Infra | Udayshivakumar Infra | IRB Infra Dev. | H.G. Infra Eng. |
|---|---|---|---|---|
| Tolls Operated (Nos.) | 15 | NA | 72 | NA |
| Operations in States | 7 | NA | 12 | 13 |
Highway Infrastructure Peer Comparison Analysis
1. Earnings and Valuation
- EPS: H.G. Infra leads with an outlier EPS (INR 75.04) but trades at the lowest P/E (14.00), signalling robust earnings power and relative undervaluation. HIL’s EPS of INR 3.13 surpasses IRB and the loss-making Udayshivakumar. This justifies HIL’s moderate P/E (22.4), well below IRB’s premium 44.38, though higher than sector outperformer H.G. Infra.
- Price to Book & Price to Sales: HIL trades at a higher price-to-book (3.43) versus all peers, indicating market optimism or perceived growth premium, but its price-to-sales is modest at 0.99.
2. Profitability and Efficiency
- ROCE: Both HIL (16.56%) and H.G. Infra (16.8%) are nearly tied for top capital efficiency, far surpassing IRB Infrastructure. Udayshivakumar’s negative ROCE (-0.92%) further highlights its operational struggles.
- P/E and Market Perception: Despite a lower P/E, H.G. Infra may be underappreciated by the market. HIL’s mid-20s P/E reflects faith in future consistency while pricing in its smaller scale.
3. Solvency and Liquidity
- Current Ratio: HIL boasts the best liquidity (1.91), reflecting financial prudence and an ability to cover short-term obligations. Peers trail closely but do not exceed 1.9.
- Debt to Equity: HIL’s leverage of 0.61X is prudent and more conservative than IRB’s 1.04X and H.G. Infra’s 1.41X, but slightly higher than Udayshivakumar’s low-risk position 0.36X. This balance allows HIL room for growth without excessive risk.
4. Peer Positioning Synthesis
- Highway Infrastructure presents a compelling risk-reward proposition: solid returns on capital, clean liquidity, and justified valuation versus both overvalued (IRB) and undervalued (Udayshivakumar, for good reason) rivals.
- IRB Infrastructure has the highest P/E and price-to-sales ratios, hinting at premium market expectations, perhaps driven by scale or unique assets.
- Udayshivakumar Infra continues to struggle with negative profitability and low valuations, reflecting its financial headwinds.
Investor Takeaways
- Strengths: Highway Infrastructure offers stable returns, prudent leverage, and margin stability. Its technology-forward approach (ANPR) is an operational plus.
- Risks: Modest top-line scale, limited geographical spread compared to leading peers, and heavy reliance on toll projects.
- Relative Value: For investors seeking a balance of profitability and risk management in the tollways sector, Highway Infra stands out as an efficient midsize operator.
In summary, as Highway Infrastructure approaches its public listing, it presents a well-managed, niche infrastructure operation with competitive return ratios. However, the gap in operational scale and geographic heft vis-à-vis industry giants like IRB and H.G. Infra could temper expectations for rapid growth or rerating.
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Highway infrastructure limited is slow growing company.. Share value may be provide good return to investors because it proves sustainability to keep their value in market….