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BHEL
Reco: HOLD
CMP: Rs 274
Target Price: Rs 275
Order cancellation at fore; Retain HOLD
· Orders worth Rs58.5 bn cancelled. 9MFY12 order inflows dismal at 133 bn. Investor concerns strengthened on order backlog quality, revenue & earning visibility
· Q3FY12 performance meets expectations – (1) Revenue +19% yoy to Rs107 bn (2) EBITDA margins down 360 bps yoy (3) APAT +2% yoy to Rs14.3 bn. Debtors rise sharply by 16% qoq
· Core business lacks growth triggers amidst multi-fold challenges. Forecast order backlog to decline from to Rs134 bn and earnings to decline by 20% in FY14E to Rs21.2
· Maintain BHEL as top AVOID in Emkay ECG universe. Maintain negative bias, though, PER de-rating from 23X to 13X could be floor. Retain HOLD with revised target of Rs275
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
BHEL
Reco: HOLD
CMP: Rs 274
Target Price: Rs 275
Order cancellation at fore; Retain HOLD
· Orders worth Rs58.5 bn cancelled. 9MFY12 order inflows dismal at 133 bn. Investor concerns strengthened on order backlog quality, revenue & earning visibility
· Q3FY12 performance meets expectations – (1) Revenue +19% yoy to Rs107 bn (2) EBITDA margins down 360 bps yoy (3) APAT +2% yoy to Rs14.3 bn. Debtors rise sharply by 16% qoq
· Core business lacks growth triggers amidst multi-fold challenges. Forecast order backlog to decline from to Rs134 bn and earnings to decline by 20% in FY14E to Rs21.2
· Maintain BHEL as top AVOID in Emkay ECG universe. Maintain negative bias, though, PER de-rating from 23X to 13X could be floor. Retain HOLD with revised target of Rs275
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