IRB infra is a proxy play on Indian road sector. IRB is amongst the largest BOT operator in India with in house execution capabilities and currently have 16 BOT projects under portfolio, of which ten are operational, five under construction and one project is in advance stage of financial closure. IRB is well positioned to add projects worth $1bn i. e about 4-6 BOT projects per annum without any equity dilution.

1) Timely execution of projects under construction will act as a catalyst for stock price.

2) NHAI's order awarding this year was laggard, we expect awarding activity to pick up before end of this year to achieve its full year target. Hence expect IRB to be major beneficiary of awarding process as IRB is pre-qualified for projects worth Rs250bn.

3) After the recent stock price correction, the stock is available at a compelling P/BV of 2.3 & 2.0 for FY11E and FY12E resp and is trading at a PE 10.6x FY12.

Our FY11E and FY12E earnings estimates are at Rs14.9 and Rs16.4, which are 3.6% higher and inline for FY12 consensus estimates. We expect topline growth of 47.6% at Rs 25.2bn for FY11 and 40% at Rs35.2bn for FY12 vs consensus estimate of 54.1% at Rs26.3bn and 47.9% at Rs38.9bn. We believe recent stock price correction provides good entry point for long term investors with upside potential of 54.4% on our SOTP based target price of Rs269 vs consensus target of Rs277.

1) Lower traffic growth; 2) Slowdown in execution of current orders 3) Any change in government policy which may adversely affect the current tolling charges.