Infra stock jumps 9% after board approves merger with its two wholly-owned subsidiaries

This Ramky Group stock engaged in developing infrastructure projects across water, transportation, irrigation, and industrial sectors, jumped 9 percent after the company’s board approves merger with its wholly-owned subsidiaries

Stock Price Movement

With a market capitalization of Rs. 3,311.11 crores, the share of Ramky Infrastructure Limited has reached an intraday high of Rs. 479.10 per equity share, rising nearly around 8.89 percent from its previous day’s close price of Rs. 440. Since then, the stock has retreated and is currently trading at Rs. 473.75 per equity share. 

What Happened

Ramky Infrastructure Limited approved the merger of its wholly-owned subsidiaries, Sehore Kosmi Tollways Limited and Ramky Elsamex Hyderabad Ring Road Limited, into the parent company. This move aims to streamline operations, reduce costs, and maximize shareholder value. 

The merger eliminates intercompany dependencies and simplifies the corporate structure. No new shares will be issued since the subsidiaries are fully owned. The goal is to create a stronger, more efficient organization that benefits all stakeholders.

Business Segments

Ramky Infrastructure’s business is divided into two main segments. The construction business (72% in FY24) focuses on EPC projects in water, wastewater, irrigation, industrial construction, transportation, buildings, and power distribution. The developer business (28% in FY24) handles projects under the PPP model, including industrial parks, transportation, integrated townships, and energy, secured through competitive bidding.

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Clientele

Ramky Infrastructure serves a diverse range of clients, including major government and private entities. Key clients include NHAI, NTPC Limited, Bihar State Road Development Corporation Ltd, Hindalco Industries Ltd, and Karnataka Power Transmission Corporation Ltd. 

Global Presence

Ramky Infrastructure has a strong geographical presence across India and abroad. It operates in 23 states and 2 union territories, with key zonal offices in Hyderabad, Bhopal, Ahmedabad, New Delhi, and Kolkata and regional offices in Chennai, Mumbai, and Bangalore. The company also has an international office in Sharjah, UAE, managing global projects efficiently.

Recent quarter results

Ramky Infrastructure Limited’s revenue has increased from Rs. 441 crore in Q3 FY24 to Rs. 459 crore in Q3 FY25, which has grown by 4.08 percent. The net profit has also grown by 57.89 percent from Rs. 38 crore in Q3 FY24 to Rs. 60 crore in Q3 FY25.

Ramky Infrastructure Limited’s revenue and net profit have grown at a CAGR of 26.96 percent and 156.60 percent, respectively, over the last three years.

In terms of return ratios, the company’s ROCE and ROE should be 21.2 percent and 19.8 percent, respectively. Ramky Infrastructure Limited has an earnings per share (EPS) of Rs. 37.5, and its debt-to-equity ratio is 0.37x.

Written By – Nikhil Naik

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