IVRCL Ltd Hold : KJMC

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IVRCL Q4FY12 standalone result was below our expectation on execution
delays. The revenue for Q4FY12 fell by 22.2% yoy on execution delays in 3-4
projects. The execution delays caused revenue loss of Rs 5-5.5 bn in 12 month
ended March 2012. Execution took a hit on various hurdles like legal &
environmental issues, slower decisions, design issues, etc related to those
four contracts. EBITDA margin took a hit with 227 bps yoy decline at 6.3% on
provisions against debtor and lower revenue bookings. The PAT for the
quarter declined by 92.3% yoy to Rs 49.4 mn. IVRCL has an order backlog of
Rs 278bn (including Rs 54 bn of L1 order) at the end of the quarter.
Key Highlights
Execution worsen in Q4FY12: The execution continued to remain subdued in
Q4FY12 with net revenue declined sharply by 22.2% on yoy basis to Rs 15.96
bn. Execution took a hit on various hurdles like legal & environmental issues,
slower decisions, design issues, etc related to four contracts. This has caused
annual revenue loss of over Rs 5-5.5 bn. We believe that the execution may
remain weak in next few quarters also. But looking at the strong order book
and a low revenue base in FY12E, we expect 12% revenue growth in FY13E.
EBITDA margin declined by 227 bps on yoy: During the quarter, IVRCL has
reported 227 bps yoy and 101 bps qoq decline in the EBITDA margins on
account of Rs 500 mn provisions against debtors and lower execution. As a
result the EBITDA for the quarter declined by 42.8% yoy to Rs 1010mn. The
interest cost for the quarter remained flattish on yoy and qoq to Rs 661 mn.
The debt at the end of the quarter remained unchanged at Rs 25 bn over
Q3FY12. The PAT for the quarter declined by 92.3% yoy to Rs 49.4 mn.
Order book grew to Rs 278 bn: IVRCL has reported a robust Rs 278 bn of
order backlog at the end of the quarter which also includes Rs 54 bn of L1
orders. The order inflow for 12 months ended March 2012 was at Rs 107 bn.
The order book composition included Rs 71.29 bn of own BOT projects.
Order backlog gives visibility, but execution delays continue to worry: The
execution rate in 12 month ended march 2012 was 22.5% of the order backlog
at the beginning of FY12. Going by the same, the current order backlog gives
a strong revenue growth visibility in FY13. But looking at delays in execution
by the company, we remain conservative in terms of making revenue growth
estimates and expect the execution rate to reduce further to 20%.

Angel Broking - IVRCL Infrastructure - RU4QFY2012 - Result Updates - PDF link

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IVRCL Infrastructure - RU4QFY2012

Construction: IVRCL: Downgrade on aggressive BOT strategy, expensive valuations :: Kotak Securities PDF link

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http://www.kotaksecurities.com/pdf/indiadaily/indiadaily19042012.pdf


Sector
Construction: IVRCL: Downgrade on aggressive BOT strategy, expensive
valuations
Energy: Legally black and white
Industrials: T&D: PGCIL keeps going full blast though domestic vendors fall
behind

Hold IVRCL; Target : Rs 72 :ICICI Securities, PDF link

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http://content.icicidirect.com/mailimages/ICICIdirect_IVRCL_ManagementMeetUpdate.pdf


Multiple near term catalysts…
We met the management of IVRCL. The key takeaway are a) sale of Noida
land parcel leading to debt reduction of | 125 crore, b) negotiation of sale
of its three key projects aggregating | 500 crore, which would support its
equity requirement of | 200 crore for ongoing projects (not considering
new win projects) and potentially further reduce its debt, going ahead and
iii) the court decision on merger of IVRCL & IVRCL Assets expected on
April 17, 2012. Furthermore, media reports indicate that the Subhash
Chandra-promoted Essel Group has raised its stake in IVRCL to 12.3%,
surpassing the promoters holding of 11.2% (promoter holding would
increase to ~13.5% post merger of IVRCL Assets & Holding). This entire
saga, we believe, would lead to retaining/gaining management control, in
which institutional holding of 42.5%  would play a critical role, going
ahead.

Technicals: Indraprastha Gas, Petronet LNG, IVRCL, Neha Int, Aishwarya Telecom, Gujarat NRE Coke : Business Line

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Should I buy Indraprastha Gas Ltd and Petronet LNG at current levels?

Suresh Kumar Yadav

Indraprastha Gas (Rs 225.2): Indraprastha Gas was hit hard by the recent order by the Petroleum and Natural Gas Regulatory Board that cut network tariff and CNG compression charge. The board had further asked the company to refund excess amount charged since 2008.

IVRCL INFRASTRUCTURE Essel Group stake acquisition a positive :Edelweiss

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Essel Group has acquired 10.2% stake in IVRCL through secondary market
and intends to further increase the stake in the company. We view this
development as positive as it could address concerns relating to funding
for IVRCL.
Essel group acquires 10.2% stake in IVRCL
Essel Group (promoted by Mr. Subhash Chandra) has acquired 10.2% stake in IVRCL
through secondary market transactions. Essel Group has an unlisted infrastructure
company, Essel Infraprojects, with interests in roads, urban infra, power, water and
solid waste projects and an order book of INR 270 bn (Source: media reports). A media
statement from Essel Group says that the group is keen to increase its stake in the
company even further, going forward. Promoters currently hold 11.2% stake in IVRCL.
Entry of Essel group could drive re‐rating
The key concern with IVRCL has been its week balance sheet and funding issues in BOT
assets, besides slower execution in the core construction business. The management
has been on the lookout for asset sales for long, but in vain. With the backing of the
Essel Group, some of these concerns, particularly relating to funding, can be addressed.
This, together with a fall in interest rates and improving business sentiments in the infra
space over the medium term could drive stock re‐rating in our view.
Outlook and valuations: Positive; maintain ‘BUY’
IVRCL is currently trading at an implied construction P/E of 6.9x FY13E. Our SOTP stands
at INR70/share, consisting of construction business at INR45 (9x FY13E EPS), IVR Assets
at INR21, (market cap) and Hindustan Dorr Oliver at INR4 (market cap).

Hold IVRCL Ltd; Target : Rs 56 ::ICICI Securities

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RATING....................................................................................... Changed from Buy to Hold
Execution hiccups lead to dismal performance…
IVRCL Ltd (IVRCL) reported a muted Q3FY12 performance on account of
execution hiccups led by client level delay impact. The order inflow was
healthy at | 10,677 crore in FY12 YTD taking its order book to | 25000
crore (including L-1 bids of | 3000 crore), 4.6x order book to bill ratio.
While we do not see any upside at current levels, we could possibly see
an earnings upgrade, going ahead, given the sharp order inflow
witnessed in FY12YTD and fund raising through asset that would support
in-house BOT project equity leading to better execution. Hence, we have
downgraded the stock to HOLD.
ƒ Execution hiccups continues to impact performance
IVRCL’s Q3FY12 topline declined 15.2% YoY to | 1195.5 crore on account
of execution hiccups due to client level delay (delay  in clearance) and
difficult weather conditions. Given  the muted topline, the OPM was
subdued at 7.3% on account of lack of absorption of overhead. This and
higher interest expenses led to a muted bottomline at | 6.8 crore.
ƒ Healthy order inflow in 9MFY12; order book at | 25,000 crore
IVRCL bagged orders worth ~| 10,677 crore in FY12 YTD and closed the
order book at | 25,000 crore in Q3FY12. The order book includes L1
orders worth | 3000 crore and captive orders worth | 6,400 crore. The
order book to bill ratio works out to 4.6x on a TTM basis.
ƒ Looking to raise | 400 crore through asset sales
IVRCL has indicated that it is in talks to sell its real estate assets Noida
land parcel (| 230 crore) and one BOT project aggregating | 400 crore. In
our view, this should help in funding FY13E equity commitment of | 300
crore required for under construction BOT projects and, therefore, could
lead to improvement in execution, going ahead.
V a l u a t i o n
At the CMP, the stock is trading at 5.8x FY13E EPS (after incorporating the
subsidiary values) and 0.7x FY13E P/BV. While we do not see any upside
at current levels, we could possibly see an earning upgrade, going ahead,
given the sharp order inflow witnessed in FY12YTD and fund raising
through asset that would support in-house BOT project equity leading to
better execution. Hence, we have downgraded the stock to  HOLD  with
SOTP price target of | 56 per share

IVRCL INFRA Execution disappoints again, order inflows strong :: Edelweiss

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IVRCL Infra (IVRCL) reported another disappointing set of numbers with
Q3FY12 earnings at INR68mn, down 84% YoY (our estimate INR125mn).
This was driven by a sharp 15% YoY dip in execution, significantly below
expectations. However, order inflow for the quarter was steady.
Management indicated that assets sale plan is on track, which should
help trim debt. The stock has rebounded sharply from December lows on
back of this news and expectations of a turn in interest rate cycle. We
believe a pick up in execution is imperative for the stock performance
from hereon. Maintain ‘BUY’ with a target price of INR72.
Execution disappoints; order inflows strong
IVRCL’s sales dipped 15% YoY to INR12bn. Further, EBITDA margin contracted 200bps
to 7.9% on operating deleverage. However, interest costs remained flat on sequential
basis as working capital was contained at the previous quarter’s level. The company’s
order intake was steady at INR30bn for Q3FY12 and INR100bn for 9mFY12. This
compares with INR100bn of order inflow for FY11. Order backlog at INR250bn (L1
INR30bn) implies strong revenue visibility of 4.6x on TTM revenues (3x over FY04‐10).
Assets sale to drive balance sheet improvement
Management highlighted that three out of four land parcels in Noida have been sold
for INR2.25bn. Further, sale of one BOT road asset is in final stages. IVR Assets has
close to INR7.5bn loan from IVRCL, of which INR4bn is expected to be repaid from
asset sale by FY12 end. This should help trim IVRCL’s debt (currently INR25bn) and
drive earnings growth in FY13 (not included in our estimates).
Outlook and valuations: Triggers ahead; maintain ‘BUY’
We have cut our revenue estimates by 9% and 14% for FY12/13 to factor in the weak
performance. IVRCL is currently trading at an implied construction P/E of 6.8x FY13E.
Our SOTP stands at INR72/share, consisting of construction business at INR45 (9x
FY13E EPS), IVR Assets at INR22, (market cap) and Hindustan Dorr Oliver at INR5
(market cap). We see potential upside to TP from potential asset sales and turnaround
in execution. Maintain ‘BUY’.

IVRCL Infrastructure :: TP: INR71 Buy ::Motilal Oswal

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 IVRCL Infrastructure's (IVRCL) 3QFY12 performance was significantly below expectations with revenue declining
15.2% YoY to INR12b, lower than our estimate of INR14.4b. Revenue growth was impacted by lack of clearances,
slow decision-making and unseasonal rains.
 The company reported EBITDA of INR948m (down 32.5% YoY) v/s our estimate of INR1.3b. EBITDA margin was
7.9% (down 200bp YoY) v/s our estimate of 9%. Margin was impacted by lower fixed-cost absorption. PAT
plunged 84% YoY to INR68m compared to our estimate of INR132m.
 Interest cost stood in 3QFY12 increased 11% YoY to INR661m from INR592m in 3QFY11, and INR652m in 2QFY12.
Interest cost was significantly below our estimate of INR840m. Depreciation increased 15% YoY to INR229m.
Debt as at end-3QFY12 was INR25b, up from INR21b in 4QFY11, and INR14.5b at end-FY10.
 Order book at end-3QFY12 was INR260b (including L1 orders of INR40b). Order intake during the quarter stood
at INR34b (up 68% YoY), contributed by Water & Irrigation projects (22% of total), Buildings (12%), Transport
(29%) and Mining (36%).
 9MFY12 order intake is INR65b (down 12% YoY). In Jan-Feb 2012, order intake was INR42b, taking the total for
YTDFY12 to INR107b (v/s INR89b for full year FY11). This includes 4 major orders: (1) INR12b order from
Hindustan Copper for the development of an underground mine of 5mtpa capacity at Balaghat, Madhya
Pradesh, (2) INR14.8m project from Ministry of Road, Transport and Highways, as part of Trans-Arunachal
highway project, (3) INR12b project including 4/6-laning of the Raipur-Bilaspur section of NH-200 in the state
of Chattisgarh; and (4) INR12b road project for 4-laning from Government of Haryana.
 We have cut our revenue estimates by 7% for FY12 and by 4% for FY13 to factor in lower-than-expected
revenue traction in 3QFY12 and likely subdued performance in 4QFY12. We have also lowered our EBITDA
margin estimates by 40bp for FY12 and by 10bp for FY13. Our revised EPS estimates are lower by 11% for FY12
and by 2% for FY13. We maintain Buy with an SOTP-based target price of INR71, valuing the core business at
INR39 (6.5x FY13E EV/EBITDA), IVRC Assets at INR27 and HDO at INR5.

PDF link - IVRCL, Tecpro:: Kotak Sec,

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http://www.kotaksecurities.com/pdf/indiadaily/indiadaily16022012.pdf


Results
IVRCL: Asset sales hold out some hope; IVRCL cites challenges in execution

Results, Change in Reco
Tecpro Systems: Strong revenues, though inflow decline and high debt limit
upside

PDF link - SCI, Simplex Infrastructures, IVRCL:: Kotak Sec,

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http://www.kotaksecurities.com/pdf/dmb/MorningInsight16022012.pdf



SHIPPING CORPORATION OF  INDIA
RECOMMENDATION: SELL
TARGET  PRICE:  RS.60
FY13E P/E: 58.5X


SIMPLEX  INFRASTRUCTURES
RECOMMENDATION: ACCUMULATE
TARGET  PRICE:  RS.230
FY13E P/E: 7.6X


IVRCL INFRASTRUCTURE LTD
RECOMMENDATION: ACCUMULATE
TARGET  PRICE:  RS.61
FY13E P/E: 15.9X

IVRCL (IIFRF, Buy) BofA Merrill Lynch,

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IVRCL (IIFRF, Buy)
Bear Case: What can go wrong
􀂄 In the bear case, a delay in capex could slow down order inflows. We
assume a 30% cut in FY13-14E base case order inflows, especially in water,
roads and electrical segments.
􀂄 We assume a slower execution by 20% in roads segment in FY13-14E on
lack of equity. Consequently, we expect sales to remain flat in FY13E and
8% growth in FY14E.
􀂄 Assumed EBITDA margin ~9.5% (-50bps base case) over FY13-14E. Also
estimate 50bps higher interest rate in FY13 and 50bps lower in FY14E.
􀂄 Consequently, we expect 60-65% cut in base EPS over FY13-14E leading to
decline in earnings at -22% CAGR over FY11-14E.
􀂄 Assumed 200bps lower traffic growth toll road SPVs on GDP growth <7%.
􀂄 In bear case, we expect de-rating of parent business to PE multiple of 5x 1-yr
forward (60% discount to E&C major). Further, assumed higher holdco
discount of 75% for real estate and 30% for other subsidiaries value.
Base Case:
􀂄 In the base case, we assumed the order inflows to grow at 79%YoY in
FY13E on low base (-47% in FY12E due to cancellation of orders) and 20%
growth in FY14E.
􀂄 We estimate sales to grow at 15-20%YoY over FY13-14E. Assumed EBITDA
margin of ~10% in FY13-14E.
􀂄 Consequently, we estimate an EPS CAGR of 10% over FY11-14E.
􀂄 In the base case, we expect parent business to de-rate & trade at PE
multiple of 7x (7.5x) 1-yr forward (50% discount to E&C major).
􀂄 To factor in de-rating of multiple, cut in HDOR value, we cut our PO by 14%
to Rs90/share valuing stock at 1.05x P/BV of FY13E
Risk-Reward: Favorable
􀂄 In the bear case, we expect the stock could trade at Rs39/share translating
into P/BV of 0.47x FY13E (parent). In the base case, we expect the stock
could trade at Rs90/share valuing at P/BV of 1.05x FY13E (parent).
􀂄 Overall, the risk-reward appears favorable once core business look up &
delivering strategies play-out in 1H 2012.

IVRCL : 2QFY2012 Result Update: Angel Broking,

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IVRCL reported a mixed set of numbers for 2QFY2012, with in-line performance
on the revenue front; however, better-than-expected performance at EBITDAM
level and lower tax rate led to higher-than-expected earnings. Order inflow for
1HFY2012 was commendable at `8,000cr (including L1 projects), given the
current scenario. The company’s order book stands at `25,500cr (4.5x FY2011
revenue, including L1 projects of `5,600cr). During the concall, management
cited that the company is in the advanced stage of selling its Noida land parcel
(book value ~`415cr) and is expecting to close the deal in the next couple of
quarters. We are tweaking our revenue estimates downwards for FY2012 to factor
in the poor performance in 1HFY2012. We maintain our Buy view on the stock.
Better-than-expected results; Positive news flow awaited: IVRCL reported a 2.7%
yoy decline in its top line to `1,046.1cr (`1,075.0cr), in-line with our estimate of
`1,075.0cr. On the EBITDAM front, the company posted flat margin of 9.0%
(8.9%) on a yoy basis, against our estimate of 8.0%. Interest cost came in at
`65.2cr (`48.0cr), a jump of 35.8% yoy/3.9% qoq and was in-line with our
estimate. IVRCL reported a 65.0% yoy decline in its earnings to `8.1cr (`23.3cr),
against our estimate of a 95.3% decline due to better-than-expected EBITDAM
and lower tax outflow.
Outlook and valuation: Management has chalked a plan to reduce the
company’s debt levels by the end of FY2012. In-line with this, IVRCL is looking to
amalgamate its BOT assets back to IVRCL Ltd. and sell its stake in operational
road BOT projects. Also, management is in the advanced stage of monetizing
land parcels. We believe reduction in IVRCL’s debt levels would lend a strong
impetus to its standalone earnings growth and, thereby, act as a catalyst for stock
price movement. We maintain our Buy recommendation on the stock with an
SOTP target price of `59.

IVRCL: Execution fails to keep pace as debt and interest costs rise:: Kotak Sec,

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IVRCL (IVRC)
Construction
Execution fails to keep pace as debt and interest costs rise. IVRCL reported flat
sales (Rs10.5 bn), significantly below estimates (Rs12 bn). Higher depreciation and
interest cost led to a PAT of only Rs74 mn. Rise in net debt (Rs6 bn) was led by higher
loans and advances and lower creditors. The board approved merger with IVRCL A&H
(broadly in line with market capitalization) and de-merger of tower and real estate
business. Revise earnings and TP to Rs59 from Rs75 earlier, retain BUY.

Yet Another Subdued Performance by IVRCL : : Nirmal Bang

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Yet Another Subdued Performance
IVRCL reported net profit of Rs81mn (down 65% YoY) for 2QFY12, below our
expectation of Rs141mn but above Bloomberg consensus estimate of Rs56mn. Net
sales remained flat at Rs10.4bn, 17% lower than our expectation and 9% down from
Bloomberg consensus estimate. However, EBITDA margin improved 230bps YoY
to 9% (60bps higher than our expectation) and EBITDA increased 32% to Rs937mn.
Interest costs and depreciation increased 36% each to Rs 652mn and Rs 249mn,
respectively. Subsequently, net profit fell 65% to Rs 81mn. We have cut our
revenue estimates by 8% for FY12E and by 5% for FY13E to factor in lower-thanexpected
revenue traction. Subsequently, this led to earnings downgrade of 22%
for FY12E and 11% for FY13E. We maintain our Buy rating on IVRCL with a revised
target price of Rs55 from Rs59 earlier.
Slower-than-expected project execution: IVRCL reported flat net sales growth at
Rs10.4bn due to slower execution of slow-moving Andhra Pradesh-based projects and
the monsoon season. The company expects revenue growth to improve in the coming
quarters, but we have cut our revenue estimates by 8% for FY12 and 5% for FY13.
EBITDA increased 32% to Rs 937mn and EBITDA margin improved 230bps because of a
low base during 2QFY11 (prior period adjustments). Interest costs and depreciation
increased 36% each to Rs652mn and Rs249mn, respectively. Subsequently, net profit
fell 65% to Rs81mn. Subsequent to our cut in revenue estimate, we downgrade our
earnings estimate by 22% for FY12E and 11% for FY13E.
Order backlog at 4.6x; comfort on revenue visibility front: During 2QFY12, the
company witnessed order inflow of Rs70bn (including L1) and the order book stood at
Rs260bn. This works out to 4.6x order book-to-bill (BTB) ratio on FY11 revenue, which
gives comfort on revenue visibility for the next three years.
Merger of IVRCL Asset Holding (IVRCLAH) with IVRCL: The management has
proposed the merger of arm IVRCLAH with IVRCL, for which the board has approved a
swap ratio of five shares of IVRCL for every six shares held in IVRCLAH. This has valued
IVRCLAH at Rs6.2bn which is in line with the valuation for IVRCLAH in our SOTP
valuation. IVRCL currently holds 75.7% stake in IVRCLAH, which will get cancelled and
lead to issue of 39.8m shares of IVRCL, thereby resulting in equity dilution of 14.9% in
IVRCL.
Valuation: We believe the declining profitability and high interest rate scenario is nearing
their bottom and it’s already discounted in the CMP. Therefore, despite a disappointing
quarter, we believe the company’s performance in the coming quarters will improve and
better geared up for future growth. Following the earnings downgrade, we cut our
target price on IVRCL from Rs59 earlier to Rs55, but maintain our Buy rating.

Buy IVRCL; Target : Rs 48 ::ICICI Securities

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Sharp traction in order inflow…
IVRCL Ltd’s (IVRCL) Q2FY12 results were better than expected largely due
to better-than-expected OPM (9% vs. our expectation of 7.5%).
Additionally, with significant order inflow in YTD FY12, IVRCL’s order
book increased sharply to ~ | 26,000 crore, 4.5x order book to bill ratio.
However, the WC and net debt position deteriorated in H1FY12 largely
due to a sharp rise in loans & advances to subsidiaries, which are
expected to be received from sale of subsidiary’s Noida land parcel.
Furthermore, it announced the merger of IVRCL Assets with IVRCL, which
would lead to equity dilution of  3.98 equity shares while IVRCL’s
promoters’ stake would increase to 13.4% from 11% currently.
ƒ Better-than-expected show in Q2FY12, order book at | 26000 crore
IVRCL’s Q2FY12 results were better than expected largely due to better
than expected OPM (9% vs. our expectation of 7.5%). Furthermore, IVRCL
has seen robust order inflow of ~| 8,000 crore in YTD FY12 taking its
order book to | 26000 crore, 4.5x order book to bill ratio.
ƒ WC & debt position deteriorates due to advance to subsidiaries
IVRCL’s net current assets increased sharply to | 3177 crore in H1FY12 vs.
| 2596 crore in FY11 largely due to  a rise in loans & advances to
subsidiaries to ~| 850 crore vs. | 541 crore in FY11 as its subsidiary
(IVRCL Assets) repaid its NCD through IVRCL. The majority of the loans &
advances from the subsidiary are expected  to be  received back  from  sale
of land parcel of ~120 acres in Noida by IVRCL Assets.
ƒ Merger of IVRCL Assets with IVRCL
IVRCL’s Board of Directors approved the merger of IVRCL Assets with
IVRCL. IVRCL Assets shareholders will receive five fully paid shares of
IVRCL for every six shares held in  IVRCL Assets. Furthermore, IVRCL’s
holding in IVRCL Assets (75.7%) will get cancelled. Consequently, IVRCL’s
equity shares would get increased by 3.98 crore to 30.7 crore and
promoter’s holding would increase to 13.4% from 11% currently.
V a l u a t i o n
At the CMP, the stock is trading at 4.3x FY13E EPS (after incorporating the
subsidiary values) and 0.5x FY13E P/BV. While there is going to be pain in
the near term, we maintain our  BUY recommendation purely on
valuation

IVRCL Infrastructure & Project Asset sale by IVRCL A&H to accelerate - :Emkay

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IVRCL Infrastructure & Project

Asset sale by IVRCL A&H to accelerate - Maintain BUY

BUY

CMP: Rs38                                        Target Price: Rs60

---

n     IVRCL’s Q1FY12 APAT at Rs81 mn (-65% yoy) marginally above est. Execution continues to remains sluggish – revenues -0.4% yoy to Rs 10.46bn, below estimates 

n     EBITDA at Rs0.94bn (+32.8%yoy) v/s est. Rs0.81bn -margins expanded 224 bps yoy to 9%, cost pressures seems to have stabilized for the first time in last 5 quarters

n     IVRCL is looking to remerge IVRCL A&H with IVRCL infra. Asset sale on fast track – IVRCL has already identified two BOT’s and Noida land parcel for divestment

n     Probable easing of liquidity crunch due to divestment of non core assets is improving outlook. Improved margins leading to 5% FY13E EPS - Maintain BUY with a Target Price of Rs60  

IVRCL, SpiceJet, TVS Srichakra ::2QFY2011 results review: Angel Broking,

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IVRCL
IVRCL reported a mixed set of numbers for 2QFY2012, with in-line performance
on the revenue front. However, better-than-expected performance at the EBITDAM
level and lower tax rate led to higher-than-expected earnings. The company
reported a decline of 2.7% yoy on the top-line front to `1,046.1cr (`1,075.0cr), inline
with our estimate of `1,075.0cr. On the EBITDAM front, the company posted
flat margin of 9.0% (8.9%) on a yoy basis, against our estimate of 8.0%. Interest
cost came in at `65.2cr (`48.0cr), a jump of 35.8% yoy/3.9% qoq, in-line with our
estimate. IVRCL reported a 65.0% decline yoy in its earnings to `8.1cr (`23.3cr),
against our estimate of a 95.3% decline owing to better-than-expected EBITDAM
and lower tax rate (8.3%). We maintain our Buy view on the stock with a target
price of `60.

IVRCL bags orders worth `972cr :Angel Broking,

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IVRCL bags orders worth `972cr
IVRCL has bagged orders aggregating to `972cr across its transportation and
mining divisions. The transportation division is the major contributor with orders
worth `918cr. The mining division contributed orders worth `54cr. With these
orders, IVRCL’s order book stands at ~`25,303cr (4.5x FY2011 revenue). This is
positive for the company as there has been a dry spell of order inflow across
sectors since the last couple of quarters with the road sector being the only
exception.
We have valued IVRCL on an SOTP basis. The company’s core construction
business is valued at P/E of 7x FY2013E EPS of `6.1 (`42.7/share), whereas its
stake in subsidiaries IVRCLAH (`12.8/share) and Hindustan Dorr-Oliver
(`4.5/share) has been valued on mcap basis, post assigning a 20% holding
company discount. At the CMP of `41, the stock is trading at P/E of 6.8x FY2013E
EPS and 0.5x FY2013E P/BV on a standalone basis and adjusting for its
subsidiaries at P/E of 3.9x FY2013E EPS, which we believe is at attractive
valuations. Therefore, on the back of the company’s robust order book-to-sales
ratio and attractive valuations, we maintain our Buy recommendation on the stock
with a target price of `60.

IVRCL bags orders worth `552cr :: - 2QFY2012, review:: Angel Broking

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IVRCL bags orders worth `552cr
IVRCL has bagged orders aggregating to `552.3cr across the buildings,
transportation and water divisions. The buildings division is the major
contributor, with orders worth `418.5cr, followed by the transportation division
(`74.5cr) and the water division (`59.3cr). With these orders, IVRCL’s order
book stands at ~`24,331cr (4.3x FY2011 revenue). Also, the total order
inflow for IVRCL Group for 2QFY2012 stands at ~`2,781cr. This is positive for
the company as there has been a dry spell of order inflow across sectors since
the last few quarters, with the road sector being the only exception.
We have valued IVRCL on an SOTP basis. The company’s core construction
business is valued at P/E of 7x FY2013E EPS of `6.1 (`42.7/share), whereas its
stake in subsidiaries, IVRCLAH (`12.8/share) and Hindustan Dorr-Oliver
(`4.5/share), has been valued on mcap basis, post assigning a 20% holding
company discount. At the CMP of `37, the stock is trading at P/E of 6.0x
FY2013E EPS and 0.4x FY2013E P/BV on standalone basis and adjusting for
its subsidiaries at P/E of 3.2x FY2013E EPS, which we believe is at attractive
valuations. Therefore, on the back of the company’s robust order book to
sales ratio and attractive valuations, we maintain our Buy view on the stock
with a target price of `60.