Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
UBS Investment Research
Lanco Infratech
Elimination impacts 1Q FY12 numbers
„ 1Q FY12 Results: Lanco reports sharp decline in PAT
In 1Q FY12, Lanco’s net operating income declined 8% YoY to Rs19.49bn due to
higher elimination of intersegment sales (Rs11.46bn in 1Q FY12 vs. Rs4.25bn in
1Q FY11). EBITDA declined 18% YoY to Rs4.91bn due to higher staff costs and
overhead expenses. Reported PAT declined 93% YoY to Rs138m. The reported
PAT is post elimination of Rs2.21bn elimination of profit from transactions with
subsidiaries and associates. The numbers are below UBS-e and consensus estimate.
„ Utilisation (PLFs of power plants) is low in 1Q FY12
Lanco has reported low PLFs in 1Q FY12 (Kondapalli I – 66%, Kondapalli II –
81%, Amrkantak I – 74%, Amrakantak II – 70% and Aban – 73%) Lanco’s total
power generation asset portfolio is 9,300 MW of which 3,292 MW is already
installed and operational. The company has 6,000 MW under construction; these
projects have achieved financial closure and are on track. By the end of FY12, the
company expects to have ~4,000MW under operation.
„ EPC business order book is Rs310bn
During 1Q FY12, the company has reported an order inflow of Rs25bn and the
current order book stands at Rs310bn. The contribution of power related orders is
~90% and other orders are related with roads, buildings and industrial projects. The
internal orders (for Lanco’s power projects) contribute 75-80% of the order book.
„ Valuation; maintain Buy rating and price target of Rs70
We derive our price target using a sum-of-the-parts methodology. We value Lanco
as a conglomerate, with power contributing 68% of valuation and EPC 23%.
Q Lanco Infratech
Lanco Infratech Limited (Lanco), established in 1993, is an integrated
infrastructure developer with interests in power, infrastructure, construction and
real estate. Lanco is among the leading private sector power generation
companies. It has a captive construction division that directly benefits from the
award of in-house power, real estate and infrastructure projects.
Q Statement of Risk
Risks include: failure to procure coal for existing or future power plants, the
inability to fully recover changes in coal prices, slow or non-collection of
accounts receivables, difficulties in securing bank or other funding for
development projects, lower than expected merchant power prices.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
UBS Investment Research
Lanco Infratech
Elimination impacts 1Q FY12 numbers
„ 1Q FY12 Results: Lanco reports sharp decline in PAT
In 1Q FY12, Lanco’s net operating income declined 8% YoY to Rs19.49bn due to
higher elimination of intersegment sales (Rs11.46bn in 1Q FY12 vs. Rs4.25bn in
1Q FY11). EBITDA declined 18% YoY to Rs4.91bn due to higher staff costs and
overhead expenses. Reported PAT declined 93% YoY to Rs138m. The reported
PAT is post elimination of Rs2.21bn elimination of profit from transactions with
subsidiaries and associates. The numbers are below UBS-e and consensus estimate.
„ Utilisation (PLFs of power plants) is low in 1Q FY12
Lanco has reported low PLFs in 1Q FY12 (Kondapalli I – 66%, Kondapalli II –
81%, Amrkantak I – 74%, Amrakantak II – 70% and Aban – 73%) Lanco’s total
power generation asset portfolio is 9,300 MW of which 3,292 MW is already
installed and operational. The company has 6,000 MW under construction; these
projects have achieved financial closure and are on track. By the end of FY12, the
company expects to have ~4,000MW under operation.
„ EPC business order book is Rs310bn
During 1Q FY12, the company has reported an order inflow of Rs25bn and the
current order book stands at Rs310bn. The contribution of power related orders is
~90% and other orders are related with roads, buildings and industrial projects. The
internal orders (for Lanco’s power projects) contribute 75-80% of the order book.
„ Valuation; maintain Buy rating and price target of Rs70
We derive our price target using a sum-of-the-parts methodology. We value Lanco
as a conglomerate, with power contributing 68% of valuation and EPC 23%.
Q Lanco Infratech
Lanco Infratech Limited (Lanco), established in 1993, is an integrated
infrastructure developer with interests in power, infrastructure, construction and
real estate. Lanco is among the leading private sector power generation
companies. It has a captive construction division that directly benefits from the
award of in-house power, real estate and infrastructure projects.
Q Statement of Risk
Risks include: failure to procure coal for existing or future power plants, the
inability to fully recover changes in coal prices, slow or non-collection of
accounts receivables, difficulties in securing bank or other funding for
development projects, lower than expected merchant power prices.
No comments:
Post a Comment