Thermax - Concerns linger, Retain Hold - Emkay

Reco: HOLD
CMP: Rs585
Target Price: Rs505

- Revenues down 9% yoy to Rs12 bn (in line), EBITDA margins at 10.2% (-60 bps yoy) (in line). But APAT ahead estimates at Rs0.9 bn (-10% yoy). Subsidiaries loss reduces to Rs37 mn

- Energy segment meets estimates with revenue decline at 10% yoy and EBIT margins at 9.9%. Environment disappoints with 7% yoy decline in revenues and 9.6% EBIT margins

- Sustains order inflow momentum with orders worth Rs13.4 bn, despite unfavourable macro. Also indicates confidence in sustaining momentum - key re-rating trigger

- Cut earnings estimates by 9% & 5% to factor losses in subsidiaries. Believe concerns on subsidiaries and margins outweigh positives. Retain Hold with revised target of Rs505

Source : Equity Bulls

Keywords