Sadbhav Engineering Ltd 3QFY2016 Results: Angel Broking

Views of Mr. Santosh Yellapu (Sr. Research Analyst - Infrastructure, Angel Broking) on Sadbhav Engineering Ltd 3QFY2016 Results:

SEL reports muted set of 3QFY2016 numbers

"Sadbhav Engineering Ltd. (SEL) reported muted set of 3QFY2016 numbers. Revenues for the quarter grew 4.3% YoY to INR 753cr, lower than our expectation of INR 766cr. We sense lower than expected execution of their in-house BOT projects led to the revenue miss. Lower contribution from their in-house BOT projects and higher other operating expenses led SEL report 36b YoY decline in EBITDA margin to 9.8%, which is again lower than our expectation of 10%. PAT for the quarter came in at INR 27cr, lower than our expectation of INR 31cr. On adjusting for exceptional item of INR 1.4cr, SEL's Adj. PAT for the quarter stood at INR 26cr. Adjusted PAT margin come in at 3.4% for the quarter vs 5.2% in the corresponding period a year ago. 3QFY2016 Adj. PAT numbers benefited from lower depreciation. During the quarter, SEL reported that their INR 319cr JV order with HCC got cancelled, taking the total order inflows (as per our estimates) for 9mFY2016 to INR 2,305cr. Accordingly, we estimate the company's order book to be at INR 8,237cr as of 3QFY2016-end (OB to LTM sales ratio is at 2.5x). We maintain our NEUTRAL view on the stock."

Shares of SADBHAV ENGINEERING LTD. was last trading in BSE at Rs.311.75 as compared to the previous close of Rs. 302.3. The total number of shares traded during the day was 1900 in over 179 trades.

The stock hit an intraday high of Rs. 314.5 and intraday low of 306. The net turnover during the day was Rs. 589042.

Source : Equity Bulls

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