Engineers India - Q4FY20 First Cut - ICICI Securities

(CMP: Rs. 75; MCap: Rs. 4714 crore)

Engineers India reported an overall decent set of numbers for Q4FY20. Revenues came in above expectations on the back of decent execution in the Turnkey segment despite challenging economic conditions while EBITDA margin decline was the result of higher contribution from the turnkey segment.

Q4FY20 Earnings Summary

- Engineers India reported standalone revenues at Rs. 853.8 crore with strong growth of 39.4% on YoY basis. Consultancy and turnkey (LSTK) segments contributed 47% and 53%, respectively. While for FY20, revenue grew by 31% to Rs. 3203.1 crore on YoY basis with 49% contribution from consultancy and 51% from Trunkey segment

- For Q4FY20, Consultancy revenue grew by 14% to Rs. 401.7 crore on YoY basis while turnkey revenue 73% to Rs. 452.2 crore, on YoY owing to execution pick-up

- Absolute EBITDA came in at Rs. 111 crore, up 19% on YoY basis while Overall EBITDA margin came in at 13%, down 220bps YoY mainly due to change in business mix. Consultancy and turnkey segments reported EBIT margins of 34.2% (Vs. 28.7% in Q4FY19) and 2.9% (Vs. 6.3% in Q4FY19), respectively. For FY20, EBITDA margin stood at 13.8%, down 120bps due to change in business mix

- EIL reported PAT at Rs. 116.5 crore which grew by 22.8% on YoY basis. While other income grew by 14.9%, YoY to Rs. 68.5 crore. For FY20, PAT grew by 16.3% to Rs. 430.3 crore on YoY basis

- EIL continues to generate decent cash flows from operations with strong cash and bank balance to the tune of Rs. 2942 crore as on FY20. It announced a final dividend of Rs. 1.55 per share

EIL delivered revenues above expectations while EBITDA margins declined on the back of higher turnkey segment contribution. On the other hand, the consultancy segment registered improved EBIT margins.

We would be coming out with a detailed report post the conference call.

Shares of ENGINEERS INDIA LTD. was last trading in BSE at Rs.74.5 as compared to the previous close of Rs. 72.35. The total number of shares traded during the day was 922604 in over 7475 trades.

The stock hit an intraday high of Rs. 81.45 and intraday low of 73.8. The net turnover during the day was Rs. 71559104.

Source : Equity Bulls

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