Key points
* In Q4FY2014 the revenues of Kalpataru Power & Transmission Ltd (KPTL) grew by 12% YoY to Rs1,152 crore with a healthy performance in the T&D segment. The OPM of KPTL remained flat at 9.5% in Q4FY2014 but due to higher depreciation and interest charges the adjusted PAT declined by 3% YoY to Rs47 crore. For FY2014 the PAT grew by 6% YoY, backed by a 22% growth in sales and a steady margin in the stand-alone entity.
* JMC Projects (its listed construction subsidiary) reported significant margin expansion for Q4FY2014 to 6.2% (up 147BPS) even though its sales declined by 8%, as efforts to improve the margin and streamline the balance sheet are bearing fruits now. Another subsidiary, Shree Shubham Logistics, reported a very strong net profit growth (up by 184% YoY) in Q4FY2014, backed by strong revenue traction (up by 93% YoY) with incremental capacity and better OPM of about 17.5%. In FY2014 also the PAT of SSL grew by 52% YoY.
* The management has maintained a top line guidance of 15% for KPTL (standalone), backed by a healthy order book of 1.6x FY2014 revenues with expectations of a stable margin. But the profitability in the subsidiaries (especially JMC Projects) is expected to look up. However, in case of JMC Projects, the development of its road BOOT projects should be the key monitorable as FY2015 and FY2016 would be the first two years of tolling revenue collection. We have fine-tuned our estimates and revised our price target primarily by revising upward the valuation multiple, given the overall better outlook. Hence, we retain Buy on the stock with a revised price target of Rs200 (based on SOTP method).
To Read Complete Report Click Here
No comments:
Post a Comment