Triveni Turbine Ltd - Q4 & FY14 Result - Quick View - CMP Rs.95, Maintain HOLD - Sushil Finance

- The lower turnover and profits were primarily on account of overall slowdown in the global economies alongwith delayed order finalization and deferment of deliveries. However, the current order book provides a good visibility for FY15.

- During the year, the Company managed to gain market share from 58% to 63% in <30 MW segment. The Company continued to pitch new geographies and claims to have received good response.

- The revenues from high margin after-sales business declined by ~13% and the Company expects the after-market business to pick up internationally in the coming years. The Management believes that with the increase in numbers of higher MW turbines installed, the business from spares and servicing should also go up considerably, going forward.

- The Joint-Venture with GE, GETL recorded orders worth Rs.1.8 bn; the Company received orders for 3 turbines from South East Asian markets. The consolidated order-book stood at Rs.7.1 bn (including refurbishment orders) which suggests a top-line growth of 35%-40% in FY15.

- During FY14, the exports were Rs.1,480 mn. Of these, Rs.1,110 mn were recorded during the H2 FY14. The management expects the exports to be more than 50% of the orders intake over the next 2-3 years.

- During the year, the exports contribution to the top-line increased from ~27% to ~29%.

- The borrowings on consolidated basis have gone up from Rs.6.0 mn in FY13 to Rs.187.9 mn in FY14; as on March 31, 2014 the cash and cash equivalents stood at Rs.92.2 mn.

- The company has plans to build a testing facility for the larger megawatt of turbines in Karnataka. The land has been purchased but it's a long term plan. Once the facility is ready, it can add a top-line of Rs.1,000-2,000 mn. The initial capex would be to the tune of Rs.350 mn which would be internally generated over the next one year.

- The board of directors recommended a final dividend of Rs.0.55 per share taking the total dividend for FY14 to Rs.0.75 per share (i.e.75% of the FV of Re.1.0 per share)

During our previous update (Q3 FY14 Quick View, dated January 25, 2014) we had recommended a HOLD at the price of Rs.58. We maintain our HOLD rating for the stock on account of our positive outlook for the company.

Source : Equity Bulls

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