Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Healthy topline growth…
Simplex Infrastructure (SIL) reported stellar Q2FY12 topline growth of
25.7% YoY with moderation in the international revenues (after seeing a
sharp decline in the previous quarters). However, a 105 bps decline in
EBITDA (50 bps due to forex losses) and a sharp rise in interest expenses
took a toll on the bottomline. In terms of order inflow, with YTD order
inflow of | 3355 crore and L-1 bids of | 500 crore, SIL expects order
inflow of | 7000 crore. We like SIL on the back of a strong well diversified
order book, lowest equity commitment towards subsidiary and its
execution capabilities. We maintain our BUY recommendation.
ƒ Stellar topline growth but rising interest expenses dents profitability
SIL’s revenues grew a stellar 25.7% to | 1322 crore in Q2FY12 as
international revenues moderated at 7% YoY growth to | 123 crore after
registering a sharp decline in the previous quarters. However, the EBITDA
margin declined 105 bps to 9% largely due to forex loss of | 6 crore on
unhedged positions (impacting the OPM by 50 bps). The bottomline
declined 33% YoY due to rising interest expenses.
ƒ Order book strong at | 15,034 crore, 2.9x order book to bill ratio
SIL witnessed YTD order inflow of | 3355 crore (including | 500 crore in
October, 2011) in FY12 taking its order book to | 15034 crore, 2.9x order
book to bill ratio. Based on the YTD order inflow and L-1 bids, the
company is targeting an order inflow of | 7000 crore in FY12, marginally
lower than order inflow guidance of | 8000 crore given in the last quarter.
ƒ WC & debt position deteriorates
SIL’s WC days have deteriorated further at 136 days from 128 days in
Q1FY12 and the debt position has increased to | 1,900 crore in H2FY12
(vs. debt of | 1661 crore in FY11) taking the net debt to equity to 1.4x.
V a l u a t i o n
At the CMP, the stock is trading at 9.2x FY13E EPS and 0.8x FY13E P/BV.
While there is going to be pain in the near term, SIL’s strong well
diversified order book, lowest equity commitment towards subsidiary and
execution capabilities make it a strong candidate for sharp earning
upgrade and re-rating in the multiples when the macro environment
improves. We maintain our BUY recommendation on the stock.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Healthy topline growth…
Simplex Infrastructure (SIL) reported stellar Q2FY12 topline growth of
25.7% YoY with moderation in the international revenues (after seeing a
sharp decline in the previous quarters). However, a 105 bps decline in
EBITDA (50 bps due to forex losses) and a sharp rise in interest expenses
took a toll on the bottomline. In terms of order inflow, with YTD order
inflow of | 3355 crore and L-1 bids of | 500 crore, SIL expects order
inflow of | 7000 crore. We like SIL on the back of a strong well diversified
order book, lowest equity commitment towards subsidiary and its
execution capabilities. We maintain our BUY recommendation.
ƒ Stellar topline growth but rising interest expenses dents profitability
SIL’s revenues grew a stellar 25.7% to | 1322 crore in Q2FY12 as
international revenues moderated at 7% YoY growth to | 123 crore after
registering a sharp decline in the previous quarters. However, the EBITDA
margin declined 105 bps to 9% largely due to forex loss of | 6 crore on
unhedged positions (impacting the OPM by 50 bps). The bottomline
declined 33% YoY due to rising interest expenses.
ƒ Order book strong at | 15,034 crore, 2.9x order book to bill ratio
SIL witnessed YTD order inflow of | 3355 crore (including | 500 crore in
October, 2011) in FY12 taking its order book to | 15034 crore, 2.9x order
book to bill ratio. Based on the YTD order inflow and L-1 bids, the
company is targeting an order inflow of | 7000 crore in FY12, marginally
lower than order inflow guidance of | 8000 crore given in the last quarter.
ƒ WC & debt position deteriorates
SIL’s WC days have deteriorated further at 136 days from 128 days in
Q1FY12 and the debt position has increased to | 1,900 crore in H2FY12
(vs. debt of | 1661 crore in FY11) taking the net debt to equity to 1.4x.
V a l u a t i o n
At the CMP, the stock is trading at 9.2x FY13E EPS and 0.8x FY13E P/BV.
While there is going to be pain in the near term, SIL’s strong well
diversified order book, lowest equity commitment towards subsidiary and
execution capabilities make it a strong candidate for sharp earning
upgrade and re-rating in the multiples when the macro environment
improves. We maintain our BUY recommendation on the stock.
No comments:
Post a Comment