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http://content.icicidirect.com/mailimages/ICICIdirect_UnityInfraprojects_Q3FY12.pdf
Strong margin show…
Unity Infraprojects’ (Unity) Q3FY12 results were above our estimates as
the company reported superior margins of | 14.5% vs. our estimates of
13%. The order book stands at | 3,932 crore (2.2x order book to bill ratio),
which should improve further with materialisation of L-1 bids (~| 1015
crore). We highlight that Unity has bucked the trend and continued to
deliver superior results vis-à-vis its peers. With plans to raise | 175 crore
from stake dilution in two SPVs and a possible rate cut in H2CY12, Unity
could further benefit in terms of debt reduction and interest cost,
respectively. We maintain our BUY recommendation on the stock with a
target price of | 73 per share.
ƒ Another positive surprise on EBITDA front
Unity’s revenues grew 9.9% YoY to | 489.6 crore in Q3FY12, slightly
below our expectation. However, net profit at | 24.7 crore was higher
than our estimates mainly due to superior margins. Unity again posted
superior margins of ~14.5% vs. our estimates of ~13%.
ƒ Order book at | 3,932 crore, 2.2x order book to bill ratio
Unity’s order book stood at |3,932 crore, 2.2x order book to bill ratio (on
TTM basis). The current order book implies inflow of ~| 1690 crore in
YTDFY12. In terms of L-1 bids, it currently stands at | 1015 crore. The
company is well poised to achieve or even surpass its order inflow
guidance of ~| 2,000 crore for FY12.
ƒ Looking to dilute stake in 2 SPVs and raise | 175 crore
Unity is looking to dilute its stake in the Bengaluru land bank of 20 acres,
which it holds in JV and a hotel project in Nagpur. It is planning to raise
| 175 crore from the same. Additionally, the company also has ~39 acres
of another land parcel Bengaluru. The company has not provided any
further details on the same as the plans are at a nascent stage.
V a l u a t i o n
At the CMP, the stock is trading at 3.4x FY13E EPS and 0.5x FY13E P/BV.
Unity has continued its superior performance. We believe it is expected to
perform better than other construction companies in the challenging
environment. Hence, we maintain our BUY recommendation on the stock.
We have valued the stock at | 73 per share (4.2x EV/EBITDA, 30% discount
to leading midcap construction companies).
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
http://content.icicidirect.com/mailimages/ICICIdirect_UnityInfraprojects_Q3FY12.pdf
Strong margin show…
Unity Infraprojects’ (Unity) Q3FY12 results were above our estimates as
the company reported superior margins of | 14.5% vs. our estimates of
13%. The order book stands at | 3,932 crore (2.2x order book to bill ratio),
which should improve further with materialisation of L-1 bids (~| 1015
crore). We highlight that Unity has bucked the trend and continued to
deliver superior results vis-à-vis its peers. With plans to raise | 175 crore
from stake dilution in two SPVs and a possible rate cut in H2CY12, Unity
could further benefit in terms of debt reduction and interest cost,
respectively. We maintain our BUY recommendation on the stock with a
target price of | 73 per share.
ƒ Another positive surprise on EBITDA front
Unity’s revenues grew 9.9% YoY to | 489.6 crore in Q3FY12, slightly
below our expectation. However, net profit at | 24.7 crore was higher
than our estimates mainly due to superior margins. Unity again posted
superior margins of ~14.5% vs. our estimates of ~13%.
ƒ Order book at | 3,932 crore, 2.2x order book to bill ratio
Unity’s order book stood at |3,932 crore, 2.2x order book to bill ratio (on
TTM basis). The current order book implies inflow of ~| 1690 crore in
YTDFY12. In terms of L-1 bids, it currently stands at | 1015 crore. The
company is well poised to achieve or even surpass its order inflow
guidance of ~| 2,000 crore for FY12.
ƒ Looking to dilute stake in 2 SPVs and raise | 175 crore
Unity is looking to dilute its stake in the Bengaluru land bank of 20 acres,
which it holds in JV and a hotel project in Nagpur. It is planning to raise
| 175 crore from the same. Additionally, the company also has ~39 acres
of another land parcel Bengaluru. The company has not provided any
further details on the same as the plans are at a nascent stage.
V a l u a t i o n
At the CMP, the stock is trading at 3.4x FY13E EPS and 0.5x FY13E P/BV.
Unity has continued its superior performance. We believe it is expected to
perform better than other construction companies in the challenging
environment. Hence, we maintain our BUY recommendation on the stock.
We have valued the stock at | 73 per share (4.2x EV/EBITDA, 30% discount
to leading midcap construction companies).
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