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Good Results Tecpro Systems delivered first quarter FY12 results in line with our expectations. Management seems to be confident on achieving a growth of 35-40% in top-line and 35% growth in order intake for the year. However, we are cautious since the order book inflow was quite low during the first quarter. The performance of the stock would depend on healthy intake of orders in the coming quarters. Key Highlights
• The company’s revenues grew by 40% YoY at Rs.349.75 crore in Q1FY12 against Rs.250.2 crore in Q1FY11.
• Total expenditure for the quarter stood at Rs.311.09crore as compared to Rs. 232.92crore in corresponding quarter last year, up by 33. 6%.
• EBIDTA margins reported were 11.82% as compared to 7.88% in previous year’s corresponding quarter, which shows an improvement of 3.94% YOY, resulting from increase in sales growth and improved operational efficiency.
• Profits stood at Rs.5.38crore, a rise of whopping 275% YoY.
• EPS reported was Rs.1.07 per share, which is up by 234.48% YOY.
• Order book inflow during the quarter was Rs.210crore taking the order backlog to Rs.4222crore.
• Material Handling segment contributed 45%, Ash Handling 8% and BOP contributed 47% of the order book.
Recommendation and Valuation Over the past few years, the company has grown at a phenomenal pace along with entry into the booming BOP-EPC space. Current order book of Rs. 4222 Crs gives revenue visibility for next 2-3 years. In addition, tie up with the US firm AC-Tek for overland conveyor projects and foray into water treatment projects provides diversification to the company. Considering the overall macro sentiment we are assigning a Target PE multiple of 10x (earlier 11x) to the stock and arrive at a new price target of Rs.322 (earlier Rs.354). At CMP, the stock is trading 8 x the EPS of Rs.32.2 of FY12E and we reiterate BUY rating on the stock.
Performance Analysis
o The company's Net Revenue stood at Rs.349.75crore as against Rs.250.21crore in the corresponding quarter of the previous year, registering a growth of 40%. Revenue growth was contributed by both Material Handling and BOP segment.
o Company reported a healthy EBIDTA margin of 11.82% as compared to 7.88% in the first quarter of previous fiscal year. This was made possible due to increase in volume of sales and improved operational efficiency.
o Profit after Tax (PAT) was 5.38crore at 1.5% of revenue as against Rs.1.44crore at 0.55% of revenue in the corresponding quarter last year. PAT has grown by 274.82% Y-o-Y.
o Interest cost during the quarter was Rs. 33crore as compared to 17.61crore in Q1FY 2011(YOY). Slowdown in collection from debtors and lower order inflow has resulted in higher debt levels.
o No significant difference in Tax Rate during the quarter, if compared to the tax rate in the previous year’s quarter, it remains around 35%.
o EPS stood at Rs.1.07 is up by 234.38% YoY
o Lumpiness is observed in the performance over the quarters, it increases as the year progress.
Order Intake during the quarter was at Rs.210crore, mainly led by steel sector, taking the total amount of order backlog to Rs.4222 crs. The order book predominantly comprise of power sector which consitiutes as much as 83.10% of the order book. Steel contributing 5.20%, cement 5.60% and other sector contributed 6.10%. Segement wise Materrial handling contributed 45%, BOP 47% and Ash handling contributed 8% of the order book.
• As per the Management of the company, all the projects are being executed smoothly and are running as per schedule.
• The company bagged orders worth Rs.210crore in first quarter FY2012 and the company is expecting an order inflow growth of 30 – 35% by the end of current fiscal year as compared to the previous quarter, which will result in a robust growth in the order book.
• Further, the management said they have considerable bids in the pipleline, which are on level 1 and technical evaluation stage.
Order Intake during the quarter was at Rs.210crore, mainly led by steel sector, taking the total amount of order backlog to Rs.4222 crs. The order book predominantly comprise of power sector which consitiutes as much as 83.10% of the order book. Steel contributing 5.20%, cement 5.60% and other sector contributed 6.10%. Segement wise Materrial handling contributed 45%, BOP 47% and Ash handling contributed 8% of the order book.
• As per the Management of the company, all the projects are being executed smoothly and are running as per schedule.
• The company bagged orders worth Rs.210crore in first quarter FY2012 and the company is expecting an order inflow growth of 30 – 35% by the end of current fiscal year as compared to the previous quarter, which will result in a robust growth in the order book.
• Further, the management said they have considerable bids in the pipleline, which are on level 1 and technical evaluation stage.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Good Results Tecpro Systems delivered first quarter FY12 results in line with our expectations. Management seems to be confident on achieving a growth of 35-40% in top-line and 35% growth in order intake for the year. However, we are cautious since the order book inflow was quite low during the first quarter. The performance of the stock would depend on healthy intake of orders in the coming quarters. Key Highlights
• The company’s revenues grew by 40% YoY at Rs.349.75 crore in Q1FY12 against Rs.250.2 crore in Q1FY11.
• Total expenditure for the quarter stood at Rs.311.09crore as compared to Rs. 232.92crore in corresponding quarter last year, up by 33. 6%.
• EBIDTA margins reported were 11.82% as compared to 7.88% in previous year’s corresponding quarter, which shows an improvement of 3.94% YOY, resulting from increase in sales growth and improved operational efficiency.
• Profits stood at Rs.5.38crore, a rise of whopping 275% YoY.
• EPS reported was Rs.1.07 per share, which is up by 234.48% YOY.
• Order book inflow during the quarter was Rs.210crore taking the order backlog to Rs.4222crore.
• Material Handling segment contributed 45%, Ash Handling 8% and BOP contributed 47% of the order book.
Recommendation and Valuation Over the past few years, the company has grown at a phenomenal pace along with entry into the booming BOP-EPC space. Current order book of Rs. 4222 Crs gives revenue visibility for next 2-3 years. In addition, tie up with the US firm AC-Tek for overland conveyor projects and foray into water treatment projects provides diversification to the company. Considering the overall macro sentiment we are assigning a Target PE multiple of 10x (earlier 11x) to the stock and arrive at a new price target of Rs.322 (earlier Rs.354). At CMP, the stock is trading 8 x the EPS of Rs.32.2 of FY12E and we reiterate BUY rating on the stock.
Performance Analysis
o The company's Net Revenue stood at Rs.349.75crore as against Rs.250.21crore in the corresponding quarter of the previous year, registering a growth of 40%. Revenue growth was contributed by both Material Handling and BOP segment.
o Company reported a healthy EBIDTA margin of 11.82% as compared to 7.88% in the first quarter of previous fiscal year. This was made possible due to increase in volume of sales and improved operational efficiency.
o Profit after Tax (PAT) was 5.38crore at 1.5% of revenue as against Rs.1.44crore at 0.55% of revenue in the corresponding quarter last year. PAT has grown by 274.82% Y-o-Y.
o Interest cost during the quarter was Rs. 33crore as compared to 17.61crore in Q1FY 2011(YOY). Slowdown in collection from debtors and lower order inflow has resulted in higher debt levels.
o No significant difference in Tax Rate during the quarter, if compared to the tax rate in the previous year’s quarter, it remains around 35%.
o EPS stood at Rs.1.07 is up by 234.38% YoY
o Lumpiness is observed in the performance over the quarters, it increases as the year progress.
Order Intake during the quarter was at Rs.210crore, mainly led by steel sector, taking the total amount of order backlog to Rs.4222 crs. The order book predominantly comprise of power sector which consitiutes as much as 83.10% of the order book. Steel contributing 5.20%, cement 5.60% and other sector contributed 6.10%. Segement wise Materrial handling contributed 45%, BOP 47% and Ash handling contributed 8% of the order book.
• As per the Management of the company, all the projects are being executed smoothly and are running as per schedule.
• The company bagged orders worth Rs.210crore in first quarter FY2012 and the company is expecting an order inflow growth of 30 – 35% by the end of current fiscal year as compared to the previous quarter, which will result in a robust growth in the order book.
• Further, the management said they have considerable bids in the pipleline, which are on level 1 and technical evaluation stage.
Order Intake during the quarter was at Rs.210crore, mainly led by steel sector, taking the total amount of order backlog to Rs.4222 crs. The order book predominantly comprise of power sector which consitiutes as much as 83.10% of the order book. Steel contributing 5.20%, cement 5.60% and other sector contributed 6.10%. Segement wise Materrial handling contributed 45%, BOP 47% and Ash handling contributed 8% of the order book.
• As per the Management of the company, all the projects are being executed smoothly and are running as per schedule.
• The company bagged orders worth Rs.210crore in first quarter FY2012 and the company is expecting an order inflow growth of 30 – 35% by the end of current fiscal year as compared to the previous quarter, which will result in a robust growth in the order book.
• Further, the management said they have considerable bids in the pipleline, which are on level 1 and technical evaluation stage.
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