RITES, Kalpataru Projects, Ahluwalia Contracts: 3 stk ideas by Axis Direct

Stocks to buy: Axis Direct has recommended 'Buy' call on Kalpataru Projects International, RITES Ltd and Ahluwalia Contracts

Stoks to buy: Axis Direct has named Kalpataru Projects International, RITES Ltd, and Ahluwalia Contracts as its top conviction ideas from the non-road infra space. In the long-term, it said, the government's support through increase in capex, better order inflow and better tendering are key monitorable.

RITES Ltd

On RITES, Axis Direct recommended a 'Buy' rating for a target price ₹275, implying an upside of nearly 25 per cent from Wednesday's close of ₹221.30.  It said that the company in the third quarter (Q3FY26) secured over 140 new orders, aggregating to ₹1,141 crore, taking the total order book to ₹9,262 crore. This provides strong revenue visibility for the next 2 to 2.5 years.  It said that with a robust tender pipeline and rising opportunities across the infra landscape, RITES remains well-positioned to deliver long-term growth.  The turnkey segment has begun to show an uptick from Q3 and accounted for 49 per cent of the company’s order book. With executions expected to pick up, the segment will likely be a key driver of revenue growth going forward.

 

Kalpataru Projects

On Kalpataru Projects International, the brokerage has recommended a 'Buy' call for a target price of ₹1,450. This signals an upside of 29 per cent from yesterday's close of ₹1,118.25.  It said that the company has a robust order book to support the revenue growth. At the end of third quarter (Q3FY26), the value of the order book stood at ₹63,287 crore.  Backed by a strong execution track record and expanding opportunities across all segments, the company is positioned for steady revenue growth, projecting a 21 per cent CAGR from FY25 to FY27E.The YTD order inflow stood at ₹19,546 crore.  The company holds L1 positions in projects worth ₹7,000 crore, largely concentrated in the Transmission & Distribution (T&D) and Buildings & Factories (B&F) segments.The management expects full year order inflows to exceed ₹25,000 crore, with a continued strategic focus on T&D and B&F.  It added that the rising share of high-margin T&D and B&F projects is likely to support margin expansion and improved profitability. The brokerage expects Ebitda margin expansion and PAT growth to deliver a CAGR of 24 per cent and 46 per cent, respectively, over FY25–27E.

Ahluwalia Contracts

On Ahluwalia Contracts, Axis Direct has recommended a 'Buy' call with a target price of ₹915, predicting an upside of 13 per cent from the stock's last close price of ₹809.75.   It said that the company's order book stood at ₹18,680 crore at the end of the third quarter which provides revenue visibility for the next 2.5 to 3 years.  In 2026 so far, the company reported a robust order inflows of ₹9,562 crore and currently holds L1 status in four projects aggregating ₹2,485 crore. For FY26, management had guided for order inflows of over ₹8,000 crore, which has already been achieved.  For FY27, the management has guided for a moderate order inflow target of around ₹5,000-6,000 crore as the focus shifts toward improving execution efficiency, enhancing margins and ensuring timely completion of the projects.  For FY26, the company has revised its revenue growth guidance to 10-15 per cent from 15-20 per cent due to the restrictions imposed by the National Green Tribunal (NGT) in Delhi. It has, however, maintained a revenue growth outlook of 15-20 per cent for FY27.         ================================== 

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