Management meet - Engineers India Ltd (EIL) :: IndiaNivesh, link

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We met management of Engineers India Ltd (EIL) to get the better understanding
of future prospects of the company. Management remains positive on the
international business opportunity and revival in domestic hydrocarbon market.
Engineers India is leading engineering consultancy and EPC Company. Company
has Significant track record across entire oil & gas value chain including 10 greenfield
refineries, 39 oil & gas processing plants, 40 offshore process platforms, 42
pipelines and 7 petrochemical complexes.
Key take-away:
Higher contribution from consultancy orders good for margin expansion: At the
end of H1FY15, Order book of EIL stood at Rs 37.2 Bn , which gives 1.5 years of
revenue visibility to the company. Out of this, ~72% orders are contributed by
Consultancy business (high margin) and rest is from turnkey projects business-LSTK
(low margin). In FY11-14 period, margin for consultancy segment has been in the
range of 35-43%, on the other hand margin for LSTK segment has been 6-12%.
Higher contribution from consultancy orders will likely help the company improving
margins from current levels of 12.4% in FY15E to ~19% level in FY16E and FY17E.
This will be major trigger point for the stock.

LINK
http://www.indianivesh.in/Admin/Upload/635563011692047500_NiveshDaily%20-%206%20January%202015.pdf