Lakshmi Machine Works Ltd - Weak order inflow- Maintain hold - Emkay

Reco: HOLD
CMP: Rs 1733
Target Price: Rs 1577

- Q1FY13 results were ahead of estimates - Revenues at Rs4.3bn (down 15% YoY), EBITDA at Rs531mn (down 25% YoY) and PAT at Rs310mn (down 25% YoY).

- Order inflow for Q1FY13 remained weak at Rs1.2bn v/s Rs5.5bn in Q1FY12. Active orders in total order book were at 30%. Order book stood at Rs39bn v/s Rs43bn in Q4FY12.

- Weak order inflows led to revenue decline of 15% & 9% yoy in Textile machinery and machine tool, resp. EBITDA margin at 12.3% declined 161bps yoy albeit improved 255bps qoq.

- Going forward, we expect flat revenue growth for FY13E due to weak order inflow & slow conversion of inactive orders into active. EBITDA margin is estimated at 12.3% for FY13E. Maintain HOLD with revised TP of Rs1577.

Source : Equity Bulls

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