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Supreme Infrastructure India Ltd (SIIL) reported better than expected
Q4FY12 results. The company reported strong 54.9% yoy growth in Q4FY12
net revenue and 41.2% growth in EBITDA on strong execution in across all
segments. But PAT for the quarter declined marginally by 1.1% to Rs 270.7
mn. In the quarter, the company added Rs 6.2 bn of new orders resulting into
total order book at Rs 39.028 bn. The OB includes Rs 5.98 bn of L1 orders. The
company has achieved financial closure in all of its BOT projects awarded till
FY12 end. The company has recently bagged a new BOT road project in
Punjab of Rs 1.17 bn project cost in JV with SPML Infra.
Key Highlights
Q4FY12 performance better than expectation: In Q4FY12, revenue grew by 54.9%
yoy to Rs 5.07 bn which was above our expectation of Rs 4.08 bn. The growth
in revenue was driven by strong execution across all segments. In road
segment strong execution witnessed in Panvel Indapur project. The EBITDA
margin for the quarter remained subdued at 14% which declined by 137 bps
on yoy basis on account of increased exposure to new states where the
resources have been mobilized but revenue booking have not picked up. As
per the company, the margins are expected to be back on track in the coming
quarters. The adjusted PAT for the quarter declined by 1.1% on yoy to Rs
270.7 mn on account of rise in interest expenses. The interest cost grew by
104% on yoy and 7.9% on qoq to Rs 272.7 mn on increase in debt. The gross
debt increased to over Rs 7.4 bn on account of funding of BOT projects.
Order Book remained robust at Rs 39 bn: In the quarter SIIL added Rs 6.2 bn of
new orders resulting into total order book at Rs 39 bn. This includes Rs 5.98
bn of L1 orders. The order book includes 42.2% of the orders from its own
BOT road projects and 57.8% of non BOT projects from buildings, power,
roads, etc. In the quarter, the company added Rs 2.325 bn of order from
buildings, Rs 3.7 bn from roads and Rs 160 mn from water segment.
Financial closure achieved in BOT road projects awarded till FY12: Out of total 9 BOT
projects, 2 projects are operational. In FY13, 2 more BOT road projects, Manor
Wada and Patiala Malerkotla would be operational. Out of total Rs 7.5 bn of
equity requirement Rs 38 bn is already infused by Supreme Infra. 3i capital
will infuse Rs 3.06 bn and balance Rs 640 mn would be infused by Supreme
in the next 3 years.
Outlook & Valuation
After witnessing strong execution in FY12 and robust order inflows
resulting into current order backlog of Rs 39bn, we believe that SIIL would
achieve a decent revenue growth in FY13E. We have upgraded our estimates
for FY13 based on strong execution in the past year and impressive order
backlog. Based on FY13E and FY14E revised EPS of Rs 60.8 and Rs 78.1, the
stock is trading at P/E of 4.5x and 3.5x respectively. We maintain our BUY
recommendation with revised target price of Rs 344 based on SOTP
valuation (Rs 304 for EPC, based on 5x FY13EPS & Rs 40 for BOT, based on
0.5x equity invested in BOT).
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Supreme Infrastructure India Ltd (SIIL) reported better than expected
Q4FY12 results. The company reported strong 54.9% yoy growth in Q4FY12
net revenue and 41.2% growth in EBITDA on strong execution in across all
segments. But PAT for the quarter declined marginally by 1.1% to Rs 270.7
mn. In the quarter, the company added Rs 6.2 bn of new orders resulting into
total order book at Rs 39.028 bn. The OB includes Rs 5.98 bn of L1 orders. The
company has achieved financial closure in all of its BOT projects awarded till
FY12 end. The company has recently bagged a new BOT road project in
Punjab of Rs 1.17 bn project cost in JV with SPML Infra.
Key Highlights
Q4FY12 performance better than expectation: In Q4FY12, revenue grew by 54.9%
yoy to Rs 5.07 bn which was above our expectation of Rs 4.08 bn. The growth
in revenue was driven by strong execution across all segments. In road
segment strong execution witnessed in Panvel Indapur project. The EBITDA
margin for the quarter remained subdued at 14% which declined by 137 bps
on yoy basis on account of increased exposure to new states where the
resources have been mobilized but revenue booking have not picked up. As
per the company, the margins are expected to be back on track in the coming
quarters. The adjusted PAT for the quarter declined by 1.1% on yoy to Rs
270.7 mn on account of rise in interest expenses. The interest cost grew by
104% on yoy and 7.9% on qoq to Rs 272.7 mn on increase in debt. The gross
debt increased to over Rs 7.4 bn on account of funding of BOT projects.
Order Book remained robust at Rs 39 bn: In the quarter SIIL added Rs 6.2 bn of
new orders resulting into total order book at Rs 39 bn. This includes Rs 5.98
bn of L1 orders. The order book includes 42.2% of the orders from its own
BOT road projects and 57.8% of non BOT projects from buildings, power,
roads, etc. In the quarter, the company added Rs 2.325 bn of order from
buildings, Rs 3.7 bn from roads and Rs 160 mn from water segment.
Financial closure achieved in BOT road projects awarded till FY12: Out of total 9 BOT
projects, 2 projects are operational. In FY13, 2 more BOT road projects, Manor
Wada and Patiala Malerkotla would be operational. Out of total Rs 7.5 bn of
equity requirement Rs 38 bn is already infused by Supreme Infra. 3i capital
will infuse Rs 3.06 bn and balance Rs 640 mn would be infused by Supreme
in the next 3 years.
Outlook & Valuation
After witnessing strong execution in FY12 and robust order inflows
resulting into current order backlog of Rs 39bn, we believe that SIIL would
achieve a decent revenue growth in FY13E. We have upgraded our estimates
for FY13 based on strong execution in the past year and impressive order
backlog. Based on FY13E and FY14E revised EPS of Rs 60.8 and Rs 78.1, the
stock is trading at P/E of 4.5x and 3.5x respectively. We maintain our BUY
recommendation with revised target price of Rs 344 based on SOTP
valuation (Rs 304 for EPC, based on 5x FY13EPS & Rs 40 for BOT, based on
0.5x equity invested in BOT).
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