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India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
UNITY INFRAPROJECTS
PRICE: RS.37 RECOMMENDATION: BUY
TARGET PRICE: RS.74 FY13E P/E: 2.5X
Result highlights: Results were better than our estimates and led by
improved execution and better than expected operating margins. Stock is
currently trading at very attractive valuations and we continue to maintain
BUY on the company.
q Revenue growth stood at 13% YoY, in line with our estimates. This was
led by strong order book and improved execution.
q Operating margins remained strong at 16.1% for Q2FY12 due to decline
in construction expenses. We however expect margins to be in the range
of 12.5-13% going forward.
q Net profit growth was better than our estimates due to strong revenue
growth and excellent margins. However, interest outgo jumped up quite
sharply.
q We marginally tweak our FY12 estimates and roll forward our valuations
on FY13 estimates and arrive at a revised price target of Rs 74 (Rs 86 earlier)
at 5x FY13 estimated earnings and continue to maintain BUY on the
company.
Revenue growth led by strong order book
n Revenue growth stood at 13% YoY, in line with our estimates. This was led by
strong order book and improved execution
n Order inflow during FY12 till date stood at Rs 11 bn (Rs 6.56 bn in Q2 and in Oct,
2011) and current order book of company stands at Rs 37.96 bn diversified
across water supply, buildings and road segment. Recently awarded projects are
spread across regions such as Jharkhand, Gujarat, Karnataka, MP and Gujarat.
Current order book is diversified across civil (54%), water supply and irrigation
(30%) and transportation (16%). Revenues during Q2FY12 were diversified
across civil (62%), civil (25%) and others(13%).
n Though order inflow for the company has remained better than its comparable
peers, we remain conservative in our order inflow and execution estimates as
against company's expectation of Rs 40 bn worth of order inflow. We continue to
maintain our estimates and expect revenues to grow at a CAGR of 12% in FY11-
FY13.
Operating margins stayed strong
n Operating margins remained strong at 16.1% for Q2FY12 due to higher proportion
of building related projects executed in the current quarter.
n Margins are likely to remain high for the company due to focus towards higher
margin buildings and water supply related projects.
n We maintain our estimates and expect margins to be 12.5% going forward.
Net profit growth led by better execution and improved margins
n Net profit growth was better than our estimates due to strong revenue growth
and excellent margins. However, interest outgo jumped up quite sharply.
n This was due to increase in overall borrowings for H1FY12 as compared to
H1FY11. Overall borrowings have although declined in comparison with Q1FY12.
n Company expects to reduce overall borrowings going forward through efficient
working capital management as well as through stake sale in in Nagpur real
estate project.
n We thus tweak our estimates and expect net profits to grow at a CAGR of 8%
between FY11-FY13.
Valuation and recommendation
n At current price of Rs 37, stock is trading very attractive valuations of at 2.9x and
2.5x P/E and 3.5x and 3.4x EV/EBITDA multiples for FY12 and FY13 respectively.
n We marginally tweak our FY12 estimates and roll forward our valuations on FY13
estimates and arrive at a revised price target of Rs 74 (Rs 86 earlier) at 5x FY13
estimated earnings.
n We continue to maintain BUY on the company.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
UNITY INFRAPROJECTS
PRICE: RS.37 RECOMMENDATION: BUY
TARGET PRICE: RS.74 FY13E P/E: 2.5X
Result highlights: Results were better than our estimates and led by
improved execution and better than expected operating margins. Stock is
currently trading at very attractive valuations and we continue to maintain
BUY on the company.
q Revenue growth stood at 13% YoY, in line with our estimates. This was
led by strong order book and improved execution.
q Operating margins remained strong at 16.1% for Q2FY12 due to decline
in construction expenses. We however expect margins to be in the range
of 12.5-13% going forward.
q Net profit growth was better than our estimates due to strong revenue
growth and excellent margins. However, interest outgo jumped up quite
sharply.
q We marginally tweak our FY12 estimates and roll forward our valuations
on FY13 estimates and arrive at a revised price target of Rs 74 (Rs 86 earlier)
at 5x FY13 estimated earnings and continue to maintain BUY on the
company.
Revenue growth led by strong order book
n Revenue growth stood at 13% YoY, in line with our estimates. This was led by
strong order book and improved execution
n Order inflow during FY12 till date stood at Rs 11 bn (Rs 6.56 bn in Q2 and in Oct,
2011) and current order book of company stands at Rs 37.96 bn diversified
across water supply, buildings and road segment. Recently awarded projects are
spread across regions such as Jharkhand, Gujarat, Karnataka, MP and Gujarat.
Current order book is diversified across civil (54%), water supply and irrigation
(30%) and transportation (16%). Revenues during Q2FY12 were diversified
across civil (62%), civil (25%) and others(13%).
n Though order inflow for the company has remained better than its comparable
peers, we remain conservative in our order inflow and execution estimates as
against company's expectation of Rs 40 bn worth of order inflow. We continue to
maintain our estimates and expect revenues to grow at a CAGR of 12% in FY11-
FY13.
Operating margins stayed strong
n Operating margins remained strong at 16.1% for Q2FY12 due to higher proportion
of building related projects executed in the current quarter.
n Margins are likely to remain high for the company due to focus towards higher
margin buildings and water supply related projects.
n We maintain our estimates and expect margins to be 12.5% going forward.
Net profit growth led by better execution and improved margins
n Net profit growth was better than our estimates due to strong revenue growth
and excellent margins. However, interest outgo jumped up quite sharply.
n This was due to increase in overall borrowings for H1FY12 as compared to
H1FY11. Overall borrowings have although declined in comparison with Q1FY12.
n Company expects to reduce overall borrowings going forward through efficient
working capital management as well as through stake sale in in Nagpur real
estate project.
n We thus tweak our estimates and expect net profits to grow at a CAGR of 8%
between FY11-FY13.
Valuation and recommendation
n At current price of Rs 37, stock is trading very attractive valuations of at 2.9x and
2.5x P/E and 3.5x and 3.4x EV/EBITDA multiples for FY12 and FY13 respectively.
n We marginally tweak our FY12 estimates and roll forward our valuations on FY13
estimates and arrive at a revised price target of Rs 74 (Rs 86 earlier) at 5x FY13
estimated earnings.
n We continue to maintain BUY on the company.
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