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Cochin Shipyard - Q1FY21 Result Update - ICICI Securities
Posted On : 2020-08-18 19:06:41( TIMEZONE : IST )
Cochin Shipyard (CSL) registered a substandard performance in Q1FY21 as production was halted till May 5. After this, production started on a reduced time scale for a significant period of the quarter affecting overall performance. Revenue for the quarter was at Rs. 332.5 crore, down 55% YoY. Shipbuilding (SB) revenue fell 47.5% YoY to Rs. 316.1 crore while shiprepair (SR) segment contracted 87.7% YoY to Rs. 16.35 crore in the quarter. On a segmental profitability front, SB reported EBIT of Rs. 62.5 crore whereas SR clocked an EBIT (loss) of Rs. 8.9 crore. SB, SR segments contributed 95.1%, 4.9% to the topline, respectively. Employee expenses stayed stable, coming in at Rs. 69.9 crore. EBITDA margin came in at 5.1% during the quarter, contracting ~1400 bps YoY. Absolute EBITDA de-grew 88% YoY to Rs. 17 crore. Consequently, PAT came in at Rs. 42.6 crore, down 65% YoY.
Valuation & Outlook
CSL continues to have a solid order book of Rs. 14393 crore. A healthy cash balance of Rs. 1950 crore as on June end provides adequate liquidity for capex, business execution. Considering all factors, we revise our estimates upwards and build in 8.1%, 2.1%, -4.6% revenue, EBIDTA and PAT CAGR for FY20-22E, respectively. SB revenues are expected to grow at 12% CAGR while shiprepair is expected to grow at 1.0% CAGR in FY20-22E. We expect overall margins to get diluted in FY21E due to impact on operations due to shutdown, lower other income. On the whole, we maintain BUY on the stock and value CSL at 9x FY22E earnings to arrive at a target price of Rs. 395.
For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_CochinShipyard_Q1FY21.pdf
Shares of Cochin Shipyard Ltd was last trading in BSE at Rs.339.95 as compared to the previous close of Rs. 337.45. The total number of shares traded during the day was 7556 in over 366 trades.
The stock hit an intraday high of Rs. 340.9 and intraday low of 336.15. The net turnover during the day was Rs. 2560241.
